The unused band

My client's mother who was originally born in the UK died recently having returned to live in the UK last year. For the previous 17 years she had lived in Cyprus with her husband who died there in 2002 leaving his estate to his wife.

Shortly before returning to UK she gifted £250 000 from the proceeds of the sale of her house in Cyprus to her sons. The sons then used some of this money to purchase a property for her in the UK.

The rest of the proceeds from the house sale remained in a Cyprus bank account up to the date of death.

I should be very grateful if Taxation readers would confirm that the whole of the deceased's estate — including the gift — is liable to UK inheritance tax and whether relief would be available for any unused percentage of...