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HMRC internal manual

Inheritance Tax Manual

Adjustment of tax paid: underpayments

As a general rule, if too little tax has been paid, the additional tax is payable with interest.  This is so even if the tax paid was that stated in a Notice of Determination (NOD) (IHTM37001) under IHTA84/S221.  This general rule may be restricted or excluded by any of the following

  • the instructions on reopening IHT liabilities (IHTM30411)
  • the instructions on reconsideration of value (IHTM30421)
  • where there is a change of view of the law or practice (IHTM30451)
  • lapse of time (IHTM30461)
  • a clearance certificate (IHTM40141) has been issued.

Where a transfer is reported after tax on a subsequent transfer has been settled, you need to consider IHTA84/S264.