Assessing: calculations: lifetime events: immediately chargeable transfers
Who prepares the calculation?
If you are dealing with a death estate and an immediately chargeable transfer (IHTM04067) is declared late, you are responsible for calculating any tax which should have been paid at the time the transfer was made. If the additional charges (IHTM14571) are more than the original tax charge you should raise an additional charge calculation, deducting nil tax on the original charge.
The settlement caseworker will continue to deal with any aspects they have already started work on.
Once you have worked out the chargeable value of your immediately chargeable transfer (IHTM14531), you can normally raise a calculation on COMPASS. But, if the charge relates to one of the exceptions that COMPASS cannot deal with (IHTM31014) you will need to:
- use the manual calculation template (IHTM31301).
- add the previous lifetime cumulative transfers (IHTM14533) (PLCT).
- take off the IHT threshold, and multiply the remainder by the appropriate rate of tax (IHTM14534) (half the rate for charges arising on a death at that date).
Apportion and deduct any tax attributable to previous lifetime transfers, leaving the tax due on the transfer itself.
Apply any reliefs against tax in the appropriate box on the calculation.
You will now have the total tax charge for this lifetime transfer. You can follow the death estate instructions for the further aspects to consider.
- Revision to the original tax charge (IHTM31416)
- IOP cases (IHTM31418)
- Tax previously paid (IHTM31419)
- Interest (IHTM31420)
If the transferor dies within seven years of the immediately chargeable transfer, you will also have to consider additional charges arising because of the death.