Using example 3, imagine that ERS had been opened before any
assessment was raised. ERS has a nil estate value baseline and so
works on the basis that all of the IHT threshold is available to
use against the amendments.
Simply recording the sub-threshold non-yield changes of
£35,000 and the change to PCLT of £50,000 would not be
above the “unused” threshold and so no yield would be
registered.
Here, we need to adjust the sub threshold changes box to
reflect the £255,000 original ‘used’ threshold, as
well as the £35,000 non-yield adjustment.
The yield adjustments are
Increase/ Decrease
| Sub-threshold changes | + £290,000 |
| Changes to PLCT | +£50,000 |
Yield is calculated as 40% x (£50,000 - £10,000
threshold remaining [£300,000 - £290,000]) =
£16,000
