Topic

Residue to Exempt and Non Exempt Beneficiaries

If a will leaves the residue of the estate to a mixture of exempt and non exempt beneficiaries, it is necessary to firstly determine who bears the liability for the IHT and secondly to work out the amount of IHT payable. 

The usual rule here is that the non exempt share bears the tax due on the residue but that they share any tax due on the legacies within the Will. This can be varied by a provision within the Will however. 

This is not always straightforward to determine and is further complicated if there are tax free legacies within the will which results in double grossing being required. This is particular complicated and in these circumstances specific tax advice should be obtained.