Inheritance Tax Deadlines and Penalties

[Sesed]

I understand that Inheritance tax has to be paid in a certain period (is it 4 months) from date of valuation but what if you have no money to pay upfront? We have been left an estate, some people got quite large % and have no cash - we need to sell the house as the largest asset to get the money out.
Also, are funds all release at the same time? There is plenty of cash to meet the tax liabilities of everyone, but would the cash be frozen until the house is sold, or can you use that? What are the penalties for late payment?

 

[mandelbrot]

I can't give you much specific guidance because I'm not familiar with inheritance tax filing, BUT...

the tax system is mainly self-assessment, so that means the taxpayer has 2 separate responsibilities:
1. To file the return and declare how much they owe
2. To pay the tax

Penalties apply where you don't file a return (i.e. you fail to comply with the obligation to file a return) by the due date for filing.
Interest applies where you don't pay by the due date for payment.

So in general if you file a return on time but haven't the money to pay by the payment date, you incur interest. The rate is ~11% p.a.

As I said at the outset I'm not familiar with how CAT operates, but the rest of the self-assessment system operates pretty much as above.

 

[Vanilla]

Your post is contradictory- on the one hand you say a house needs to be sold in order to release money for tax, but on the other hand you say there is plenty of cash in the estate to pay tax- which is it or are there beneficiaries in both circumstances?

Inheritance tax must be paid by the end October following the valuation date unless the valuation date is after end August in any year when it goes to the following October.

The valuation date therefore is important. You really need to discuss this with the solicitor involved in the estate as the solicitor, you and the accountants can work together to avoid penalties where possible.