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Stephens Scown have recently been successful in saving a family over £1,000,000 of inheritance tax by using a less well known and little used tax exemption.
Philip Reed, partner in Stephens Scown private client department in St Austell used the “death on active service” exemption in the estate of an 83 year old veteran of the Second World War who sustained injuries in France in 1944 and who died in 2005.
Mr Reed explained that “despite death occurring 61 years after the injuries, we were able to show that the cause of death was linked to those injuries and full exemption was granted after very detailed scrutiny by the Ministry of Defence. The Defence Council agreed with our evidence and HM Revenue and Customs are bound by the decision.”
Second World War veterans are not the only possible claimants.
“The rules apply to anyone that dies from wounds, accident or disease contracted whilst on active or warlike service with the armed forces. There will be many service families with relatives who have served in other conflicts such as Aden, Malaya, Korea, Northern Ireland, the Falklands and recently in Kuwait, Iraq and Afghanistan” he added.
“My concern is that many other estates in Devon and Cornwall and elsewhere may be eligible for this complete exemption from inheritance tax, and that families and their advisors are not aware of it. In this recent case, a lifetime of pain was properly recognised by the Ministry of Defence and the family estate remains intact. It really is important for veterans to record how they sustained their injury by talking to their solicitor when making their will. If we have the information in advance, we can present a much better case to the MoD”.
For more information please contact a member of the team.
