Post Death Income

Hi all,

Another query in relation to handling of estate - my father passed away intestate and it's taken a while to get grant of probate.
As part of settling things up, I now have to register the estate to declare post death income for tax purposes as there are a couple of rental properties.
The query I have is in relation to one property where the rent is paid by HAP - as his tax clearance cert expired on his death, the payments have been retained by HAP until we can get a letter of clearance from Revenue. Do these funds held back by HAP have to be declared as post death income for my father's estate and be taxed as part of it or does it sit outside this and whoever receives it declares it as income?

Any advice or pointers would be appreciated!

Thanks.

The income after your father's death will belong to his estate. There are two possible scenarios - the first is that there is an estate period in which your father's estate pays tax on the income from his date of his death to the date of grant of probate. The second scenario is that the beneficiaries are treated as being taxable on the income from his date of death. The latter scenario, if my memory serves me correctly, applies where the beneficiaries of the estate are Irish tax resident. My understanding is that the Revenue need to state that the beneficiaies are treated as being taxable from date of death. The second scenario, if available, is more straight forward. I would add that I haven't looked at this in a number of years and the practice may have changed.

Thanks for that. Revenue have told us we need to register estate for tax up to grant of probate so I think that rules out the latter option.

if the beneficiaries are Irish tax resident ask the Revenue if they can be deemed to be entitled to the income from date of death (I forget the precise term) - it might simplify tax returns. Don't go down this road it if means that the rental income arises for a period for which a tax return should have ben filed. For example if the income relates to 2023 there isn't much point in asking for this as the beneficiaires may be surcharged (10% of the additional tax) for a filing a tax return late. There are exceptions to this surcharge but one would be getting into areas of Revenue practice that require a knowledge of the system. I'm not withholding details - it is just too cumebrsome to explain and there are a few variables.