HMRC has significantly increased its scrutiny of inheritance tax filings in recent years, with a particular focus on estates that require a full Inheritance Tax account (form IHT400). Rising inheritance tax receipts, frozen nil‑rate bands and improved data‑matching techniques mean HMRC is now better equipped to identify inconsistencies, under valuations and missing information. As a result, compliance checks that were once relatively selective are now common, especially for higher‑value or more complex estates.

For Personal Representatives (PRs), this increased scrutiny makes the accurate completion of the IHT400 more important than ever. The form is not simply administrative; it is a detailed tax return requiring careful identification of assets and liabilities, accurate valuations, disclosure of lifetime gifts and correct claims for reliefs and exemptions. Errors can lead to delays in obtaining probate and prolonged correspondence with HMRC, often at an already stressful time.

The risks for PRs can be significant. HMRC may charge interest on underpaid tax and impose financial penalties for inaccurate returns, even where mistakes are unintentional. Careless errors can attract penalties of a percentage of the tax understated and PRs can be held personally liable if the estate suffers a loss as a result of incorrect reporting or premature distribution of assets.

Engaging a solicitor can help minimise these risks. A solicitor can guide PRs through the IHT400 process, ensure that appropriate valuations are obtained, identify which reliefs are available and confirm that all supporting schedules are completed consistently. Professional advice not only reduces the likelihood of HMRC enquiries but also provides reassurance that PRs have taken reasonable steps to fulfil their legal duties and protect themselves throughout the estate administration process.

If you are a PR struggling to navigate the often complex world of inheritance tax and probate, please get in touch with our team.