Payment using the deceased’s Government Stock

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How do I pay using the deceased's Government stock?

The tax on some of the assets has to be paid before the issue of a grant of representation. To help you to do this you can, if you wish, pay the tax using the deceased's British Government stock, such as

  • War Loan
  • Treasury Stock
  • Exchequer Stock.

Please note that it may take up to four weeks from the receipt of your application until the money is transferred to HM Revenue & Customs. For this reason, we suggest that you do not use this method of payment if the grant of representation is needed urgently.

How do I find the value of the British Government Stock?

You can find out the value of British Government stock from your bank or stockbroker or from the UK Debt Management Office.

Does the stock have to be registered in the deceased's own name?

Yes, you can only use stock to meet the payment of Inheritance Tax where the deceased is registered as the sole (or surviving) stockholder, following receipt of formal proof of death. If the stock is registered to an investment company, who dealt with it on behalf of the deceased, it cannot be used to pay the tax.

What else do I need to do?

You need to write to the registrars for British Government stock, and let them know that you want to transfer funds from the British Government stock to pay the inheritance tax and how much you want to transfer. You will also need to provide them with formal proof of death. The registrars are:

Computershare Investor Services PLC
PO Box 2411
The Pavilions
Bridgwater Road
Bristol
BS3 9WX
Helpline 0870 703 0143
E-mail gilts

Computershare may need the reference number to help them find a particular investment. This number appears on the stock certificate and on correspondence from the Bank of England.

It is not necessary to liquidate the whole holding of stock. If necessary, Computershare will only liquidate enough of the holding to meet the payment of tax. They aim to deal with requests within 5 working days.

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Will there be a charge for this service?

Computershare charge a commission for this service. For stock with a value of up to £5,000 the rate is 0.7%. Otherwise there is a charge of £35 for the first £5,000 and a rate of 0.375% is charged on everything over this. (Rates correct at 01/09/2005.)

What do I need to send to HMRC Inheritance Tax?

First you need to obtain an Inheritance Tax reference number. You can do this by applying for an IHT reference online using the 'do it online' link, or by using the form D21 Application for an Inheritance Tax reference (PDF 40K). You should apply for a reference at least three weeks before you expect to make the payment.

When we receive your reference request we will send you, by post, a note of your reference number

Once you have obtained your reference number, you need to send us a letter stating how much of the tax you want to be paid out of the British Government stock together with the inheritance tax account IHT200 and form D18 to our Pre-Grant section.

  • If you are applying for a grant in England, Wales or Northern Ireland, send them to our address in Nottingham.
  • If you are applying for Confirmation in Scotland you should send these letters with the completed inheritance tax account IHT200 and C1 inventory form to our Edinburgh address.

What happens next?

When we receive the forms and letters we contact Computershare asking for the money to be transferred to HM Revenue & Customs. This may take up to four weeks. If the amount transferred is enough to cover the tax due and

  • you are a personal applicant applying for a grant in England, Wales or Northern Ireland we will send the receipted D18 direct to the Probate Registry so they can issue the grant.
  • you are a practitioner applying for a grant in England, Wales or Northern Ireland we will send the receipted D18 to you so you can apply for a grant.
  • you are applying for Confirmation in Scotland we will receipt the C1 and return it to you, so that you can apply for Confirmation from the sheriff clerk or commissary clerk.

What if there is additional tax due?

If any additional tax is due after the money has been transferred to HM Revenue & Customs we will tell you how much you must pay and how to pay it.

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