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Inheritance tax

DAVID LAWESDAVID LAWES Feels At HomeRegistered Posts: 29
I've been reading various articles about inheritance tax and they all pose the following questions:

1. USE OF NIL RATE BAND LEFT BY FIRST SPOUSE - How is the unused portion of a nil rate band left by a first spouse calculated when the second spouse dies? When the representatives of the second spouse to die submit a claim for transfer of the first spouse's unused nil rate band, what evidence will HMRC accept regarding use of that first spouse's nil rate band?

2. GIFTS MADE OUT OF INCOME - A gift is exempt from IHT if it is made as part of a person's normal expenditure out of income and does not affect the donor's standard of living. Surely this is inevitably a subjective judgement. What criteria do HMRC decide in determining whether a gift constitutes normal expensditure out of income, or whether it does not?

To count as normal, gifts must be habitual. What would constitute habitual? Supposing they are made at irregualr intervals, say 1 in 2007, one in 2009, 1 in 2012?

And if such a gift has been made to a representative of the deceased, what evidence would HMRC be looking for to determine that the gift was made? Would, say, paying-in slips relating to payment into the donee's bank account be acceptable?

Any advice that anyone can give on these points woul dbe greatly appreciated.
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