Tx notes fa22 Final

June 2023 to March 2024 exams
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Step 3
Chargeable Estate at Death – 1 March 2023
Answer to Example 3 
Death estate – date of death 1 May 2022 
IHT = 290,000 @ 40%
= 116,000
Less:
Taper Relief ((5-6 years) 60%)
(69,600)
46,400
Chargeable Estate
500,000
Available nil rate band = 325,000 – 290,000 = 35,000
IHT on Estate
35,000 @ nil
= nil
465,000 @ 40%
= 186,000
500,000
£
House 
350,000
Personal chattels 
95,000
Shares held in an ISA 
16,000
Car 
22,000
Life insurance policy – own life (proceeds) 
200,000
Less: Funeral expenses 
(2,500)
680,500
Less: Exempt legacy – house
(350,000)
Gross chargeable estate 
330,500
NRB at death
325,000
Less: GCTs < 7 years before death (W)
(89,000)
(236,000)
Taxable amount
94,500
IHT on chargeable estate at 40%
37,800

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June 2023 to March 2024 exams
Watch free ACCA TX lectures
Working: Lifetime gift and tax on PET 
There is no lifetime tax payable on the lifetime gift as it is a PET and there is no death tax payable as 
it is covered by the NRB.
Answer to Example 4: Joe Kerr 
W1
Transfer of value
Lifetime Transfers Chargeable When Made: Lifetime tax 
Transfer of value 
100,000
Less: Marriage exemption
(5,000)
Less:
AE (2022/23)
(3,000)
AE (2021/22)
(3,000)
Chargeable amount 
89,000