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HMRC internal manual

Trusts, Settlements and Estates Manual

Deceased persons: tax arrears when estate distributed

Notice under Section 27 Trustee Act 1925

In England and Wales, the personal representatives can give notice under Section 27 Trustee Act 1925 that the estate is to be distributed on a given date. This protects them against claims in respect of unknown debts after the estate has been wound up.

The notice has to be published in the London Gazette. If the estate includes land, the notice must also appear in a newspaper circulated in the locality of the land.

The personal representatives are responsible for ensuring that the tax due up to the date of death is correctly adjusted. So it is most unlikely that there will be any tax liabilities falling within the definition of ‘unknown debts’.

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Unknown debt

If an unknown tax debt does come to light, HMRC must make a claim against the estate before the given date. This cannot be less than 2 months from the date of the Section 27 notice. If HMRC fails to make a claim before the given date, the personal representatives no longer have to meet those tax liabilities. However we can still pursue the individual beneficiaries for the tax due.

Debt Management’s specialist unit Estates & Trusts Office, Nottingham deals with pre-enforcement collection and recovery for deceased cases.


  • you discover an unknown tax liability in excess of £1,000 after the Section 27 distribution date has passed, and
  • it is still within the normal self-assessment time limits,
  • if there is other outstanding debt this will be worked by Debt Management (DM) Estates & Trusts Office, Nottingham therefore the matter can be referred to that office to consider
  • if there is no other outstanding debt telephone DM Technical Team, Nottingham-Steve Griffin 03000 562258 or Ted Bishop 03000 562283  for further advice.

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Liability on income arising after the date of death

The Section 27 notice does not relate to tax liabilities on income arising after the date of death. This remains the responsibility of the personal representatives.