HUGE Tax Bill post Death

A question about : HUGE Tax Bill post Death

My step father recently passed away leaving my mum with alot of debt. The biggest been a bill to the HMRC of approximately Ј120000! Im sure this isn't right, they bill has been assumed as he didn't submit tax returns and iv no idea what they have based it on, the rest is charges.

Iv no idea what to do with this, there are no records so I can't submit a Tax Return.

Iv written to HMRC, in response received a further bill addressed to the estate

Firstly i want to argue the bill, I don't doubt something is owed but im quite sure it's much closer to a 1/4 if not less. Any ideas where I start....

Thanks x

Best answers:

• you will need to find evidence to support it. What are they basing their claim on? What did he do?
  There must be records somewhere which will give you an indication of earnings etc
• Firstly your stepfather cannot leave your mother "a lot of debt" he can only leave them to his estate or property. The first thing is to get information on what his estate consisted of, if he had nothing then nothing can be paid back. It is only worth checking his bills if there is anything to pay them with.
• If this is recent, was there a will and if so, who are the executors?
  The Probate Office can be helpful - at least in demonstrating that you are taking this seriously, but need a lot of time to sort it out.
  Your mum may need to consult a solicitor - does she have one, is she eligible for legal aid?
• Your late step father couldn't have been doing his returns and they have caught up with him. I know of someone who had the same situation but was still alive at the time. The bad news is, it's not down to them to prove you owe the money, it's down to you to prove you don't. This is why you keep records, so you can't get caught out like this. I got my accountant to sort my friends problem, a meeting was held between all three and a deal was thrashed out. The tax man was hard but fair, the bill was 20% of what they wanted in the end in the end but lifestyle helped to convince them that the bill was to high. Get an accountant to go over the finances for the last 6 years.
  P.s this is assuming there is an estate they can claim on, if not the debt will pass with the deceased.
• If there are no assets, then it's possible that the best thing for your mum to do is refuse to do anything. Even if she's named in a will as executor, she can't be forced to act - but once she starts to act (or "intermeddle in an estate" if you want to google it) she might be forced to continue. If there are no assets, she might be better off keeping out of it.
  If there are assets, as jackyann says your first step is to establish whether there was a will, and if there was who the executors are.
• No will, just straight forward pass over by intestacy. He was a dentist, private with his own practice. No records either, guess he just wasn't bothered! Iv just applied for his bank statements for the years he needs to file returns for, I guess the best I can do is file returns based on the information available and see what they say! Iv no doubt money is owed, it's just the amount I disagree with. They own a home, the one and only asset, it will possibly cover the bill but with nothing left over, hence id like to do something about it as opposed to nothing. My mum suffers with a mental illness and she is unable to deal with this alone.
• Going back through the years they could very well base the bill on what other dentist earn. With interest and penalties the bill may not be to far off the mark.
  They can of course claim the money from the estate, I would assume a dentist would have insurances etc, so the estate may be quite healthy indeed.
• Hi Firefly1710, thank you for your query regarding tax bill.
  It is unclear from you post if you step father had any assets or other debts which will of course affect whether HMRC can take action to recover the debt. If your step father had an accountant then I would suggest you contact them for assistance stright away. If your step father did not have an account then I would suggest you contact Business Debtline at www.bdl.org.uk who can give free confidential advice on business debts and you may also get free help from tax aid at www.taxaid.org.uk.
  Hope this is of assistance.
• Thinking about it....
  ...what happened to the dental practice? Has it been sold?
• Did your parents own their house as tenants in common, or joint tenants?
  If the former, then your mother's half will be untouchable as far as your step-father's debts are concerned, I believe.
• The posters on the Cutting Tax board here are pretty knowledgable - I'd try posting there. But I'm sure that they will tell you to go to an accountant, don't try to fill in the returns yourself, there might be a lot an accountant could do to make sure that the figures are presented in the most tax-friendly way.
  But there must surely be more business records than just the bank account - does he not have any invoices for expenses for materials, utility bills, rent etc, and records of payment from customers? The accountant is going to need every scrap of paperwork you can find.
• Hi Antrobus:
  Quote: