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A query was raised regarding whether mortgages securing third-party debts on estate assets can be deducted for Inheritance Tax purposes. The DGT ruled that such a deduction is not possible because the deceased did not hold the debt personally.
This ruling clarifies that only debts personally owed by the deceased can be used to reduce the taxable base of an inheritance, preventing the deduction of encumbrances that secure obligations of other individuals.
The tax team reviews your specific situation.
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