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Across the County Tax Tips Corner

“In this world nothing can be said to be certain, except death and taxes.” Bereavement can be a difficult and often stressful time. It’s an emotional rollercoaster, but as anyone who has been through this will also know, there is a staggering amount of paperwork to deal with too. In the circumstances, this can be quite mind boggling. If you have a solicitor dealing with an estate they are likely to make you aware of your obligations to the taxman, and should guide you through painlessly.

“Tell us Once” is a service that helps people tell government departments just once about a death. Most counties run the service and you can find out about it when you register the death. Once you register for this service, all government departments will be informed; HMRC, Tax Credits, DWP, DVLA and the passport service to name a few. If the service is unavailable in your area you will need to contact each department separately.

When someone dies it is important to determine if too much or too little tax has been paid for the year, and HMRC will send out a form R27 to the person responsible for settling the estate. It is important to check that any unused allowances for the year of death, such as married couples or blind person’s allowances are transferred to the survivor.

The death of a spouse will often make a difference to how the survivor is taxed. For example they may receive a new pension, start to receive a widow’s pension or find their State pension increased in addition to the allowances that can be transferred to the surviving spouse.

HMRC may send out a pension coding form, P161W, asking for details of income. It can be completed as soon as the survivor knows what their new pensions etc. will be and HMRC will use the information to work out how any tax due will be paid, and then issue new tax codes if required. Please don’t forget savings income. A person who becomes a taxpayer will have to revoke any election they made (on form R85) to receive gross bank or building society interest.

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