Ads by Google

Inheritance tax exceeds £4 billion

Recent figures published by the Office for National Statistics have revealed a dramatic increase in Inheritance tax receipts by the Treasury, up nearly 20% on the previous year. The expected Inheritance tax payable for the year to 28 February 2016 is £4.6 billion compared to £3.8 billion in the previous year.

A further surprising statistic is the number of estates now having to pay Inheritance tax. Since 2010 this figure has seen a fourfold increase. This figure is itself expected to double over the next five years according to the Treasury. 

The marked increase in Inheritance tax receipts is put down to house price increases,  bringing many estates into a tax payable situation. With the present level of tax free allowance at £325,000 (or potentially £650,000 for couples who have not used the full allowance on the death of the first spouse) many properties alone exceed this figure, before taking into account other assets in the estate. In 2017 the tax threshold below which Inheritance tax will be payable by homeowners will start to increase to a potential £1 million by April 2020 for couples if they leave their home to their children or grandchildren. In the meantime it appears that the Treasury will continue to benefit from rising house prices.

Ads by Google