Gransnet forums

Legal & money

Tax problems.

(27 Posts)
HUNTERF Wed 02-Jan-13 12:48:27

My father passed away early in 2012 and I thought all his tax was settled.
Suddenly I have had a request for £89 which relates to the 2008 to 2009 year which my father has underpaid according to the Inland Revenue.
The estate has now been distributed but I am the sole beneficiary.
I would like some evidence but this is going to be difficult as Dad is no longer there.
I am prepared to pay the £89 but I would like a letter from the Inland Revenue stating this is a full and final settlement of tax due from Dad's estate.
What concerns me is the Inland Revenue may ask for £1,000 in a years time without producing any real evidence.
Has anybody else had this problem and managed to get a final settlement letter from the Inland Revenue?.

Frank

Anne58 Wed 02-Jan-13 12:52:40

Frank, my experience of HMRC is that they are the most "un-joined up" body that I've ever encountered! One office never seems to communicate with another. Mr P has had letters from one office saying that he owes an amount, then a few weeks later a cheque for a rebate sent from another location!

vampirequeen Wed 02-Jan-13 13:01:49

Once the estate is officially sorted out doesn't that mean it's legally yours. I don't see how you can be responsible for paying your father's tax.

HUNTERF Wed 02-Jan-13 13:31:01

Hi phoenix

I do agree with you HMRC is very un-joined-up.
My father worked for 3 different employers during his working life and had 3 occupational pensions.
All 3 came under a different tax office.
Dad did keep a good eye on his finances and I am not really convinced the money is owed. It is a pity this matter was not bought up when Dad was alive.

vampirequeen

You may be right but I do not want to be running up solicitors costs etc for £89 as I was the sole beneficiary of the estate.
I could see practical problems in some cases however.
One of my friends was a beneficiary to 25% of the estate and the rest went abroad.
If say a bill had come in for £89 after the estate had been distributed he may have paid it but if the bill was say £10,000 he might have been prepared to pay his £2,500 share but not £10,000.
I don't know where he would have stood legally if that had happened.

Frank

Nonu Wed 02-Jan-13 13:59:41

Oh Hunter , I do feel for you , they make you crazy if you let them.

glammanana Wed 02-Jan-13 14:28:26

I'm affraid HUNTERF if I was in your position the tax office would not be receiving any payment from me with regard to my late fathers tax matters they are just that "his tax matters" not mine.
I do think you are looking to find problems that are not relivent with regard to your friend's situation if it ever arose which I very much doubt.So I agree wholeheartedly with vamperqueen and her post that you are not responsible.

Jodi Wed 02-Jan-13 14:35:39

HunterF I think you need some expert advice on this. I find it pays to have an accountant deal with tax matters or if that's not appropriate try the CAB. You do not want to be landed with a bill fir unpaid tax in years to come.

MrsJamJam Wed 02-Jan-13 15:36:51

Frank, if it was me I would start with a phone call to the tax office explaining that my father has died and that the estate has been wound up and distributed. No need to mention that you are a beneficiary. You may find that the amount is so small it will be written off.

I have generally found that the tax office people are very helpful on the phone if I put on my 'utterly charming and totally reasonable' act. Have to be very careful not to fall into my 'grumpy old woman' persona - she can creep out of her box if I am not on my guard!

bluebell Wed 02-Jan-13 16:00:51

Did you contact the tax office after your father died? There is a system in place for this and a form to fill in which should result in a final figure bring calculated. Information is available on their website. Ringing at the moment might be a bad idea as they might be busy with 31 January deadline coming up. Don't pay for advice at the moment as it certainly wouldn't be worth it for £89. Just keep a dialogue going with them (in writing). Don't ignore any communications and see how it pans out. I have obtained refunds for estates so it works both ways. I'm afraid glamanana is wrong - the tax affairs of a person who has died are not their affairs- they are the affairs of the executor - just like overpayment of benefits would be ( or under payments) I have dealt with both and found the relevant agencies helpful and efficient

Barrow Wed 02-Jan-13 16:02:25

Frank, did you obtain a Grant of Probate for your Father's estate? If so, I can't see how the Inland Revenue can now ask for more money. If you didn't then I think it would be worth ringing them and explain the estate has already been distributed.

Was a final Tax Return sent?

When my DH died, our accountant sent in a final Tax Return and received confirmation from the Tax Office that no further tax was payable.

bluebell Wed 02-Jan-13 16:45:51

Yes Barrow that must result from the form I mean R27 I think it was. Once that's completed and signed off by HMRC the tax matters are closed but you can understand that if that isn't done then they still have the right to request further payments. If Frank has completed it and been told no more tax due then that would be the end of the matter.

bluebell Wed 02-Jan-13 16:46:16

Yes Barrow that must result from the form I mean R27 I think it was. Once that's completed and signed off by HMRC the tax matters are closed but you can understand that if that isn't done then they still have the right to request further payments. If Frank has completed it and been told no more tax due then that would be the end of the matter.

HUNTERF Wed 02-Jan-13 16:52:53

Hi Barrow

I was asked to complete a final tax return in relation to the 2011 to 2012 year and I got a letter stating a refund of £201 was due and I received this.
I did get a Grant of Probate for my father's estate and the house was transferred fully into my name 2 weeks later.
My father did not have much money in cash terms but the house was worth about £500,000.
As Mum left me her half when she passed away no inheritance tax was payable as Dad's share amounted to £250,000 less 10% as I was in occupation of the house.
I think I will contact the CAB to find the best course of action.
Obviously it is not worth paying for advice as there is only £89 involved.
If I could be sure this is the final amount HMRC will ask for I would pay to get rid of it.
I want to be certain I will not be asked for any more money.
Out of interest I am living in the inherited house and sitting in the spare bedroom typing this thread.

Frank

HUNTERF Wed 02-Jan-13 17:40:03

Hi Barrow

I have found the copy form and it is R27.

Frank

Movedalot Wed 02-Jan-13 17:44:05

If you write to them you may have to wait a very long time for a response as they are always so far behind. If you want it sorted out sooner then you really will have to phone them but I would make a note of the name of the person you spoke to, the time and date and what they said. I find being a helpless poor old dear can work for some things but in my dealings with HMRC I have always been very firm but that was because I always knew exactly what the situation was and how much they owed me!

Good luck

bluebell Wed 02-Jan-13 18:14:20

Well I could give more advice but have decided Frank can well afford to pay for it - honestly , £500 k inheritance tax free and winging about £89 pounds. Yes go ahead and use up scarce CAB resources - I'm off this tread

bluebell Wed 02-Jan-13 18:15:51

Or thread even - now I'm off

HUNTERF Wed 02-Jan-13 18:18:19

Hi Movedalot

As you say you know what the situation was.
In my case Dad was dealing with his tax affairs in the 2008 to 2009 year and I feel sure he would have an answer if he was alive today.
I did work for a bank but in a specialist area so I am not as much of a finance person as most High Street bankers.
Dad was more of a finance person than me.

Frank

HUNTERF Wed 02-Jan-13 18:23:18

Hi bluebell

I can easily afford to pay the £89.
I obviously want to just make sure they do not come back for more.
Obviously I do not want to pay hundreds of £'s for advice when at first sight there only appears to be £89 involved.

Frank

crimson Wed 02-Jan-13 18:23:25

I think if you phone them you'll be on the phone from now till doomsday. Saw a newspaper headline the other day saying how much it costs people in phone calls to the tax office whilst holding the line. I think I'd write to them and keep a copy of the letter; send it by recorded delivery and keep all the details of that and ask every question you need to know and point out that you are prepared to pay anything you have to when you hear from them. Then if, in years to come they ask for more you can produce said letter and proof of postage. I've just send a cheque to them and kept a record of postage because they say they do not send receipts so I wouldn't know if the cheque had gone missing in the Christmas post.

vampirequeen Thu 03-Jan-13 07:44:15

Doesn't matter how much HunterF inherited. The estate is legally wound up. It went through probate. The Inland Revenue can't chase him for money that he doesn't owe them.

HUNTERF Thu 03-Jan-13 11:08:11

Hi vampirequeen / others

Regardless of the legal situation if a genuine error has happened and Dad underpaid his tax by £89 I will pay up.
Really what I want is:

1) If possible some evidence of the underpayment and how it happened as he had only had pensions with tax deducted and some money in 2 building societies with interest paid net of tax.
2) An explanation of why it has taken so long to come up.
3) Confirmation that there is nothing more owing.

I am not getting any of the above from HMRC at present.
My father was genuine in his financial dealings and I hope people think the same of me.
He was not in the realms of being a 40% taxpayer which could have caused errors.

Frank

Anne58 Thu 03-Jan-13 12:23:25

bluebell I didn't get the impression that Frank was "winging" as you put it, he was just asking a question with regard to get everything sorted once and for all.

Frank, the fact that you received a rebate and then a demand for £89, just goes to prove the point about HMRC, doesn't it!

HUNTERF Thu 03-Jan-13 15:45:50

Hi phoenix

You have got it right in one.
I don't think even Richard Branson or any other multi millionaire would want to spend hundreds of £'s resolving a query for £89.
Really as far as I knew my father's affairs were complete and I now want to put the matter to bed and move on with life.
I can assure you I have nothing like the wealth of Richard Branson.

Frank

Anne58 Thu 03-Jan-13 15:52:14

Frank , I think I would phone them, explain that your father is deceased and the estate wound up, and also point out that they sent you a rebate, so how can they now say that money is owed? Phrased the right way, it should make them look incompetent to say the least, and hopefully you will hear no more about it.

In some ways the amount of money is not the thing at issue, it's the principle.