Rallying call as HMRC pauses IHT30 clearance requests

The confirmation HMRC is not currently processing any IHT30 clearance requests has been described as ‘deeply concerning’ by the profession with calls to petition regulatory bodies and Parliament to avoid further consequences for clients. 

The comments come from Adam Scott, a partner at Trethowans who adds that with planned date for the resumption of the service, and no route to escalate clearance requests regardless of how long they have been outstanding, the issue is unacceptable.

HMRC has confirmed that it is not currently processing any IHT30 clearance requests; which have previously given formal confirmation that HMRC considers all Inheritance Tax (IHT) liabilities on an estate to be settled.

“This reassurance allows executors to proceed confidently with distributing assets, safe in the knowledge that no further IHT demands will be made.”

said Scott, adding

“Without this clearance, executors are left in a legal and financial limbo. Many are understandably nervous about distributing the estate without formal sign-off, particularly where high-value assets, property sales or multiple beneficiaries are involved. It undermines their confidence in taking the final steps of administration and places the risk squarely on their shoulders.”

There is no current workaround and the lack of escalation or visibility on timescales from HMRC is ‘unacceptable’ says Scott with the inability to obtain clearance impacting practitioners and clients including;

• Delayed distributions to beneficiaries, often at emotionally difficult times.
• Increased anxiety and liability for executors, especially non-professionals.
• A knock-on effect on professional advisers, who may face increased queries, complaint risk and difficulty concluding estate matters efficiently.

Scott has called on the profession to undertake a ‘collective response’ including engaging representative bodies including STEP and the Law Society amongst others, to coordinate a formal response or press for urgent clarity; and write to local MP’s to explain the impact of the delay on families and individuals.

“While we appreciate the pressure HMRC faces, this decision places an unfair burden on clients and the profession. We believe a collective response is needed. We are raising concerns through our own professional networks and will continue to provide updates. In the meantime, we would welcome discussion on how we as a profession can apply pressure in a coordinated way.”

concludes Scott. In the meantime practitioners are encouraged to document the issue clearly in file notes and correspondence to protect themselves and and demonstrate the wider context in the event of complaints.