UK Inheritance tax is “no longer just for the rich”

Experts have warned, as increasing numbers of Britons face six-figure bills.

A recent article by The Independent brings UK inheritance tax firmly into the spotlight once more.

The article mentioned above highlights how, as a result primarily of rising property prices, more and more UK families are facing six figure tax bills when their relatives die.

The article shows that the Treasury raised £2.4 billion in inheritance tax receipts in the three months to July 2022. Compared to £2.1 billion in the entire year in 2021.  This is not surprising as whilst IHT is only paid to the extent that the value of your estate exceeds £325k (£500k if you own your own home and pass this to your children or grandchildren on your death), the £325k threshold for inheritance tax has remained unchanged since April 2011, whilst property prices have soared over the same period. 

The paper reports that the average cost of property rose by £140,129 between April 2019 and June 2022- which means that not only millionaires but also many middle-class families will be subject to inheritance tax.

It is clear, that inheritance tax is proving to be more and more lucrative for HMRC. And at a time when inflation is skyrocketing. And people cannot afford to pay their bills, which makes it even more galling for many people. 

We understand, of course, that death is a subject that many people do not like to talk about. Planning for a death is even lower down the radar as people tend to focus on the here and now. Unfortunately, none of us know when our time is up. This was sadly bought into sharp focus as a result of the Covid pandemic.

At ETC Tax, we provide inheritance tax planning advice and structuring to individuals, families and family businesses. We can discuss your options with you, working alongside your solicitor to ensure that your estate and succession plan is as you want it to be.

There are various options available including outright gifts, truhttps://etctax.co.uk/tax-services/private-client-tax/trusts/sts and for those with more substantial wealth, family investment companies.

Please do get in touch.