The guidance for dealing with claims to increase the probate value of land that has been sold at a profit within three years of death has been updated by HMRC, reports ICAEW this week.
According to the guidance, where no tax was due on the sold land because either the chargeable estate was below the inheritance tax (IHT) nil rate band, or the land that was sold was exempt from IHT or attracts 100% relief, then no claim will be accepted.
This is because no tax is due, therefore no-one is entitled to claim for it.
Where the estate of the deceased is subject to inheritance tax any claim to substitute a higher value will also be rejected. This follows a case from 2001, in which it was noted that the purpose of the relevant rule is to provide relief from inheritance tax and that to allow such claims would be inconsistent with that purpose.