You are here: Home - Retirement - Retirement planning - News -

Government to cut IHT red tape

0
Written by: Emma Lunn
23/03/2021
The Treasury said it plans to cut inheritance tax (IHT) red tape in a move designed to reduce the paperwork families need to fill out when someone dies.

The move follows recommendations by the Office of Tax Simplification and come as part of ‘tax day’ announcements.

The Treasury’s Tax polices and consultations document said IHT reporting regulations will be simplified later this year so that from 1 January 2022 more than 90% of non-taxpaying estates won’t have to complete IHT forms for deaths when probate or confirmation is required.

In addition, the current temporary provision for those dealing with a trust or estate to provide an IHT return without requiring physical signatures from all those involved will be made permanent.

Reporting regulations will also be updated to clarify the requirement for estates to submit an IHT account where the deceased was never domiciled in the UK but owned indirect interests in UK residential property.

Sean McCann, chartered financial planner at NFU Mutual, said: “Currently, thousands of bereaved families are forced to complete complex inheritance tax forms, even when it is clear there is no inheritance tax to pay, often feeling forced to pay a solicitor for fear of making a mistake.

“Reducing the reporting requirements is a positive step forward, but the government should go further and simplify what is a fiendishly complex tax, feared by many but paid by few.

“Introducing simpler rules on lifetime gifts and removing some of the traps that families can fall into, such as making life insurance pay-outs free of inheritance tax, would go a long way to removing this fear.”

Rachael Griffin, tax and financial planning expert at Quilter, said: “This is a step forward towards greater simplicity, but leaves the system largely unchanged, and we are still a long-way from seeing any fundamental changes to the IHT system as recommended by the OTS and the APPG on Inheritance & Intergenerational Fairness.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

10 million Brits have less than £100 savings

Britain is facing a savings crisis with almost one in five UK adults having less than £100 stashed away for a...
10 million Brits have less than £100 savings

Grandparents gift £1m of property wealth a day during stamp duty holiday

Grandparents have gifted nearly £1m of their own housing equity a day to younger family members during the sta...
Grandparents gift £1m of property wealth a day during stamp duty holiday

One in six adults expects to be paying mortgage off in retirement

Around one in six people expect to still be paying a mortgage over the age of 65, six years over the average a...
One in six adults expects to be paying mortgage off in retirement

Ryanair jetting towards US flights for £10

Ryanair is on course to achieve its long-held ambition of offering transatlantic flights to the US – and the...

Investing in car parks: a good vehicle for income seekers?

As the search for income continues, many investors are turning to alternatives, with car parks becoming increa...

A quick guide to guarantor loans – in association with Guarantor Loan Comparison

Considering a guarantor loan or becoming a guarantor yourself? Read our essential guide...

Results round-up: Companies to watch this week

Mulberry and more will face the music this week.

Product launches of the week

Select Property Group, Schroders, Leeds Building Society and more have exciting news this week.

Money Tips of the Week

Read previous post:
Warnings raised over ‘green’ energy tariff surge

A significant jump in the number of households moving to ‘green’ energy tariffs may not be as good for the...

Close