Shaju died on 20 May 2019 leaving the following assets at its market value on the...
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Shaju died on 20 May 2019 leaving the following assets at its market value on the date of death: He had Cash of £30,000, Business worth £200,000, motor car worth £25,000, Life insurance policy £89,000, Shares of ISA £15,000, Shares of Quoted company £300,000, shares of unquoted Company £150,000, Main Residence £160,000, and Factory £500,000 Shaju had borrowed a mortgage loans of £80,000 for the main residence and on the date of deathhe amount outstanding was £20,000. Also, he borrowed endowment mortgage loan of £150,000 for the factory, and the amount outstanding on the date of death was £25,000. Shaju has the following liabilities/expenses on the date of death: Administration Expenses of the executors £8,000. Bank loan taken for the family member's marriage £20,000, Income tax due of £12,000, Credit Card Payment due £2,000. Shaju used to pay his life insurance of £20,000 per annum. He totally paid £80,000 (4 years instalments). As he died, his family members will receive insurance proceeds of £180,000. As per his Will, he kept the cash and Insurance policy to his wife, and the balance to his son. You are required to calculate: a) Gross chargeable Estate, Taxable Estate and Inheritance tax on Death Estate of Shaju and mention the due date for payment of tax (12 marks) b) "Inheritance tax is a tax on gifts or 'transfer of value' on 'chargeable property' made by 'chargeable persons" Clearly explain the above with examples. (3 Marks) Shaju died on 20 May 2019 leaving the following assets at its market value on the date of death: He had Cash of £30,000, Business worth £200,000, motor car worth £25,000, Life insurance policy £89,000, Shares of ISA £15,000, Shares of Quoted company £300,000, shares of unquoted Company £150,000, Main Residence £160,000, and Factory £500,000 Shaju had borrowed a mortgage loans of £80,000 for the main residence and on the date of deathhe amount outstanding was £20,000. Also, he borrowed endowment mortgage loan of £150,000 for the factory, and the amount outstanding on the date of death was £25,000. Shaju has the following liabilities/expenses on the date of death: Administration Expenses of the executors £8,000. Bank loan taken for the family member's marriage £20,000, Income tax due of £12,000, Credit Card Payment due £2,000. Shaju used to pay his life insurance of £20,000 per annum. He totally paid £80,000 (4 years instalments). As he died, his family members will receive insurance proceeds of £180,000. As per his Will, he kept the cash and Insurance policy to his wife, and the balance to his son. You are required to calculate: a) Gross chargeable Estate, Taxable Estate and Inheritance tax on Death Estate of Shaju and mention the due date for payment of tax (12 marks) b) "Inheritance tax is a tax on gifts or 'transfer of value' on 'chargeable property' made by 'chargeable persons" Clearly explain the above with examples. (3 Marks)
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a Gross chargeable estate Gross chargeable estate is the total fair market value of assets a deceden... View the full answer
Related Book For
Intermediate Accounting IFRS
ISBN: 978-1119372936
3rd edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
Posted Date:
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