Legal News | 22.06.23
Inheritance Tax – time for a change?
In recent weeks there has been a lot in the press speculating on the future of Inheritance Tax (IHT). These reports were in large part fueled by the former Chancellor of the Exchequer, Nadhim Zahawi, publicly calling for the abolition of IHT. Numerous Conservative MPs are in support of its abolition but, conversely, other voices defend the tax.
IHT, although often an unpopular tax, raises in the region of £7 billion each year for the Treasury. In actual fact, fewer than 4% of UK deaths result in an IHT charge. Consequently, it seems unlikely that this tax will be abolished, however, these calls may provide an opportunity for reform.
Many of the IHT rules and thresholds in place today have remained unchanged for many years. For instance, the current nil rate band of £325,000 has been in place since 2009 and the annual gift allowance of £3,000 has been in place since 1981. In a time of inflation, keeping the thresholds frozen draws an increasing number of estates into the IHT net each year.
Whether or not reforms happen, it is always worth seeking professional advice regarding your estate planning, and we are happy to help.
For further information on inheritance tax or estate planning, please get in touch with your usual Wansbroughs’ contact or email the Private Client Team at email@example.com.