PREPARATORY TASK
Victoria (who was unmarried) dies in September 2018. She made no gifts during her
lifetime. She leaves a will appointing her cousin, Harold, to be her executor. Harold
comes to see you with the following information.
1. Details of assets:
House worth £400,000
3,300 shares in BT plc (a quoted company) worth £10,000
600 shares (a 40% holding) in Mi-part Ltd, an unquoted company; the shares are
valued at £100,000
A life assurance policy with Equilaw Life Co. (not written in trust) worth £75,000
following Victoria’s death
A life assurance policy with Friends Provident Co., the benefit of which was
transferred to Victoria’s nephews, Peter and Michael, in March 2006 when it was
worth £2,000. The policy will pay out £50,000 on Victoria’s death
A bank account with a balance of £48,000
Harold says that Victoria inherited the shares in both BT plc and Mi-part Ltd in 2000
when her father died. Mi-part Limited was founded by Victoria’s father in the 1970s
and produces engine parts.
2. Details of liabilities:
£1,000 for outstanding debts
£2,000 funeral expenses
3. Details of will:
The will is a very simple one. It leaves:
£10,000 cash to Action For Children (a registered charity)
The remainder of her estate to Peter and Michael (her two nephews)
Assume that IHT rates, reliefs, exemptions, bands and allowances for past and
future years are the same as for this tax year.
Advise Harold:
1. What is the value transferred in respect of Victoria’s death estate?
1
Victoria (who was unmarried) dies in September 2018. She made no gifts during her
lifetime. She leaves a will appointing her cousin, Harold, to be her executor. Harold
comes to see you with the following information.
1. Details of assets:
House worth £400,000
3,300 shares in BT plc (a quoted company) worth £10,000
600 shares (a 40% holding) in Mi-part Ltd, an unquoted company; the shares are
valued at £100,000
A life assurance policy with Equilaw Life Co. (not written in trust) worth £75,000
following Victoria’s death
A life assurance policy with Friends Provident Co., the benefit of which was
transferred to Victoria’s nephews, Peter and Michael, in March 2006 when it was
worth £2,000. The policy will pay out £50,000 on Victoria’s death
A bank account with a balance of £48,000
Harold says that Victoria inherited the shares in both BT plc and Mi-part Ltd in 2000
when her father died. Mi-part Limited was founded by Victoria’s father in the 1970s
and produces engine parts.
2. Details of liabilities:
£1,000 for outstanding debts
£2,000 funeral expenses
3. Details of will:
The will is a very simple one. It leaves:
£10,000 cash to Action For Children (a registered charity)
The remainder of her estate to Peter and Michael (her two nephews)
Assume that IHT rates, reliefs, exemptions, bands and allowances for past and
future years are the same as for this tax year.
Advise Harold:
1. What is the value transferred in respect of Victoria’s death estate?
1
