Pictured above: Sofia Tayton
The taxman is clamping down on inheritance tax errors and scams,
Stratford-upon-Avon law firm Lodders has warned.
If you fill in the forms yourself and get it wrong, or seek to
fiddle the system, then you could be hit for 100 per cent tax.
Sofia Tayton, a solicitor and associate in the private client
department, cautioned: "HM Revenue & Customs has developed one
consistent penalty regime for inaccuracies in tax returns.
"It applies both to people submitting documents and to third
parties providing information to those submitting documents. So as
well as solicitors being at risk, the clients who provide us with
our information cannot be careless, give us incorrect details or
risk concealment."
HMRC has a three-level approach:
"Careless" - an inaccuracy due to failure to take reasonable
care.
"Deliberate but not concealed" - an inaccuracy is deliberate but
no attempt has been made to conceal it.
"Deliberate and concealed" - an inaccuracy is deliberate and
attempts have been made to conceal it, for example through
submitting false evidence.
The penalties charged can be anything from zero to 100 per cent
of the tax underpaid.
"And HMRC will want to see clear evidence of a proactive role
taken by executors to ensure that accurate valuations are obtained
and proper instructions are given to the valuers involved," said
Mrs Tayton.
"If an estimate is unavoidable, then make that clear to HMRC,
explain why, and undertake to provide a formal valuation as soon as
possible.
"People need to seek professional advice when inheritance tax is
an issue, and never seek to hide information or press valuers to
undervalue assets of the estate."
The inheritance tax threshold, or nil rate band, is the amount
up to which an estate will have nothing to pay.
It currently stands at £325,000.
For more information about Lodders, please visit their website
here: www.lodders.co.uk