14 November 2007

New procedures for paying Inheritance Tax

HM Revenue & Customs ("HMRC") have changed their process for people making initial payments of inheritance tax ("IHT") by cheque or the Direct Payment Scheme.

From 5 November 2007, before you can send your first cheque and form IHT200 to HMRC you need to contact HMRC to obtain an IHT reference number and payslip.

To obtain a reference and payslip you need to apply in writing, either through the HMRC website,  or by post, using a form D21 or by calling HMRC's Forms Orderline on 0845 30 20 900; option 1.

HMRC will then allocate a reference to the estate and send details of the reference together with a payslip and a pre-addressed envelope to you by post. HMRC aim to reply to all requests for a reference within 5 working days for online requests and within 15 working days for postal requests.  

Once you have received your IHT reference number you should write it in the top right-hand corner of the IHT200. Then, if you are paying the tax by cheque, fill in the payslip and put the payslip and cheque in the pre-addressed envelope. Send your payment to the Cashiers at Nottingham and send form IHT200 and supporting papers to either the Nottingham or Edinburgh office - depending on whether you will be applying for probate or Confirmation.

HMRC have confirmed that there is no need to apply for a reference where there is no tax to pay; simply send your completed form IHT200 etc to them in the normal way.

If you would like further advice on any aspect of IHT please contact your usual Hazlewoods contact or Helen Richmond hr@hazlewoods.co.uk.