| Laws, rules, and regulations are established to ensure | | | | of the Nil Rate band, it is transferable for the calculation |
| that equality and justice prevails in the country. On the | | | | of tax for the inheritance when the other spouse dies. |
| other hand, tax laws are created to generate revenue | | | | In this case, let us suppose when B dies, she leaves |
| for the government to support its operations. The | | | | behind an estate of 400,000 then the Nil Rate band |
| government of a country has many sources to earn | | | | would be the exempt amount plus 50% of the Nil Rate |
| revenue for its operations. However, taxes are among | | | | band i.e. 450,000 if the Nil Rate band for the year were |
| the most common sources of revenue for a country. | | | | 300,000. The Nil Rate band is the amount of |
| The government of every country has many duties, | | | | exemption granted by the government for the |
| which it needs to perform, and obviously needs | | | | calculation of tax on the inherited of property. |
| revenue to perform them. Therefore, different taxes | | | | If A leaves behind 400,000 worth of estate to his heirs |
| and duties on imports and exports are levied to gather | | | | and the Nil Rate band for the year is 325,000 then |
| enough revenue to perform these duties. | | | | 75,000 would be the amount on which the tax would |
| In the United Kingdom, there is a fixed percentage of | | | | be applicable. On the other hand, if A had left behind a |
| inheritance tax, which is to be paid if an individual | | | | property worth less than 325,000, let's say an estate |
| inherits some property. There are few laws regarding | | | | worth 300,000 then no tax would be applicable on the |
| the calculation of inheritance tax. According to the | | | | amount inherited by the heirs. |
| system of law enforced in the United Kingdom, when | | | | Sometimes, the tax calculation for inheritance related |
| a person inherits some property, a 40% tax is to be | | | | matters become very complex and difficult to |
| paid on the amount of property inherited, above the Nil | | | | understand. In such cases, a proper consultancy |
| Rate band. For the year 2009/2010, the Nil Rate band | | | | lawyer should be consulted as they are proficient in |
| is £325,000. | | | | dealing with such issues and are able to deal with the |
| According to the tax laws of the United Kingdom, if, | | | | most complex calculations. |
| after the death of the first spouse, a part or the entire | | | | Although some people would argue that paying an |
| amount to be included in the Nil Rate band is not used | | | | extra fee for the consultancy services would be an |
| at all, it is transferred, and is available for use at the | | | | added expense, which they can save by making tax |
| time of death of the second spouse. For example, if | | | | calculations themselves, but the fact is that in some |
| 'A' died leaving behind 100,000 worth of chargeable | | | | cases, paying this added fee might save one from a |
| estate and the Nil Rate band for that year was | | | | heavy future loss. |
| 200,000 and 'B', the remaining spouse, didn't use 50% | | | | |