Are deceased Coronavirus Emergency Responders eligible for exemption from inheritance tax on their estate?

For months now, medical professionals and volunteers have been saving the lives of thousands of people who have contracted Coronavirus. Sadly, a growing number of those NHS workers and other medical staff have lost their lives in the process.

Following a death, the Personal Representatives of the deceased must administer the deceased’s estate. This involves applying for Probate, collecting in the deceased’s assets, and calculating and paying any inheritance tax that is due.

This article explores an exemption from inheritance tax which is potentially available to those who have died in the course of providing medical services in the fight against Coronavirus.

The Exemption

Inheritance tax exemptions have been available to military personnel who have lost their lives during service for some time. In 2015, the scope of these exemptions was expanded to include people who work in emergency services.

When is the Exemption available?

The exemption provides relief from inheritance tax which would otherwise be payable on an emergency responder’s death and is available in various circumstances, including for those people who have died from a “disease contracted at a time when that person was responding to emergency circumstances in that person’s capacity as an emergency responder. “

Emergency circumstances are defined to include circumstances which are causing or likely to cause a person death or serious illness, or worsening of any serious injury or illness.

An emergency responder is broadly defined to include “a person employed for the purposes of providing, or engaged to provide, medical, ambulance or paramedic services”. It also includes people who are employed or engaged to provide services for transporting organs, blood, medical equipment or medical personnel.

It does not matter whether the employment or engagement is paid or unpaid, meaning that it can also apply to volunteers who provide medical services.

These provisions offer considerable scope to cover the variety of people who have provided medical services during the Coronavirus pandemic and have caught the virus themselves, including doctors, nurses, and paramedics. It is unclear at this stage how broadly the legislation will be interpreted and whether it will include people such as NHS Volunteer Responders and care home staff.

The Exemption’s Application to Coronavirus

Of course, this legislation and HMRC’s guidance on it, was not made with Coronavirus in mind, and we are yet to see how HMRC will respond to applications for the exemption to apply in these circumstances. It is hoped that, in due course, HMRC will provide specific guidance on how the exemption will be applied to deaths of such individuals as a result of the Coronavirus pandemic.

If you have any questions about the availability of inheritance tax exemptions or administering an estate, please do not hesitate to get in touch with our private client team.