A relative is leaving her home to a friend and her money to a member of the family. Inheritance tax is likely to be due. What if the friend wants to keep the house? Does the IHT payment come from the remainder of the estate or does the friend who has been left the property have to contribute towards the IHT?

While the above is correct, there are also issues that arise from the precise framing of the will. If, for example legatee A gets a specific asset (say, the house) while legatee B gets the "remainder" of the estate, the assumption could be made by the executor that the IHT is to be paid out of legatee B's part.

It becomes very messy when one part of the estate is illiquid (the house) and the rest (cash, shares, etc) is not.

As always, it really makes sense for the will to be written with a solicitor's advice and the discussion should be held in advance of decease how the IHT should be paid.

I agree this type of will is rather messy and potentially setting up conflict between beneficiaries.

When people leave a particular asset rather than a proportion of the estate then that easily becomes a problem. The value of the asset might be vastly different at point of death compared with when the will was made. Imagine having a house worth 200k and 200k cash in the bank - roll forward 20 years and the house is worth 800k and the cash still 200k. Probably not what the person intended.

I think it may be a case of the beneficiaries trying to agree between them what is a fair and reasonable arrangement. It is possible to agree a Deed of Variation to change the will as necessary/desired. The executor is expected to pay the IHT within I think 6 months to avoid additional interest charges. I agree the strict interpretation may be the IHT is paid from the cash and the beneficiary only gets any remaining cash. This may be grossly unfair and not what the deceased intended so trying to agree a suitable split may be desirable but would depend on fair mindedness from both sides - in my experience often missing.

When a house is specifically left there may also be the question of why ? Did the deceased intend the beneficiary to live in the house until they die ? What will the beneficiary do with the house in their own will ? Does the inheritor of the house have any other assets to use to pay a share of the IHT or are they able/willing to take a mortgage loan to pay it ? Does the beneficiary actually intend to live in it or would they actually want to sell it anyway and not live in it ?

As IHT is due the property will need a formal written ‘red book’ valuation from a property surveyor/valuer/estate agent to determine the value at date of death in a formal report. (May cost a few hundred poinds). The district valuer may sometimes decide to query or challenge the valuation.

For an estate due IHT it is advisable to use a solicitor to assist the process. The right one can be very helpful in bringing beneficiaries to an agreement - the wrong one can trigger more or unnecessary conflict.