Inheritance tax payments rise in spite of new tax breaks
The latest figures from HM Revenue & Customs (HMRC) show a rise of 18.7% this tax year, with estates paying £2.4bn. Sean McCann, chartered financial planner at NFU Mutual, said: “Despite the introduction of the new tax break, inheritance tax appears to be hitting families harder than ever before. Receipts have risen by almost 20% and it’s clearly the result of an ever more complicated tax system and a more aggressive approach from the taxman.”
He added that the system of reliefs for inheritance tax is “fiendishly complex”, meaning families are inheriting less than they should be: “Many families won’t realise that reliefs such as the new residence nil-rate band and the transferable spouse’s nil-rate band are only available if you claim them.
“Anyone trying a DIY approach to probate may find themselves tied up in knots by the new rules, meaning they fail to apply for all the reliefs available to them.”
Since the government’s flagship inheritance tax policy – the new main Residence Nil-Rate Band – was introduced in April, inheritance tax receipts have leapt by almost £375m when compared to the same time last year.
October is Free Wills Month. Making a will can help you mitigate inheritance tax.