What is the "Potential repayment to the estate" form (R27)?

The “Potential repayment to the estate” form, also known as the R27, is just four pages long. Most personal representatives will complete this form, though it has almost nothing to do with inheritance tax and the application for a grant of representation.

Income tax

It is, in fact, a declaration of income and allowances received by the estate in the tax year of death. That is, the period from 6th April until the date of death.

In effect, it is a self-assessment income tax return, to be completed by the personal representatives. 

Self-assessment or R40

If the deceased normally completed a Self Assessment Tax Return or R40 form, these can be completed instead of the full R27. However, pages 1,3, and 4 of the R27 should still be completed, and the appropriate box ticked at the top of page 2.

The R27 can be completed at any time during the probate process.

If the deceased’s financial affairs were managed by an accountant, you may wish to ask the accountant to complete the form, perhaps along with a Self Assessment or R40.

Is the R27 required?

Guidance from HM Revenue & Customs reveals that HMRC cannot insist on form R27 being completed.

However:

1. There may be a repayment due to the estate, which will not be known unles the R27 is submitted; and
2. If it turns out that income tax is due to HMRC, the personal representatives could be personally liable for paying it if they have failed to submit form R27.

In short, it is usually a sensible step for all personal representatives to complete form R27, even for those estates where no grant of representation is required.

For tips on completing the form, see our guide “How to complete the “Potential repayment to the estate” form (R27)”.