The latest official figures from HM Revenue & Customs (HMRC) show total inheritance tax (IHT) receipts are up by 6 per cent to £11.2 billion on the same time last year, the fastest rise than at any time since 2010.
NFU Mutual said IHT receipts have risen by over 20 per cent in the first four months of the tax year, indicating a more aggressive approach by HMRC.
NFU Mutual’s Sean McCann comments: “The extra scrutiny from tax officials means those who haven’t taken professional advice or planned early could be caught out. This could have a catastrophic effect on family wealth. IHT is one of the more complex taxes and there are plenty of traps to fall foul of – as many families appear be finding out.”
Since the introduction in April of the government’s inheritance tax policy, the new Residents Nil Rate Band, inheritance tax receipts have increased significantly by more than £330 million when compared to the same time last year.
The HMRC report reads: “Receipts rose steadily until 2007-08 due to increases in the value of tax-liable assets in this period, particularly in the value of residential property. Receipts then fell sharply due to both the introduction of the Transferable Nil Rate Band for deaths occurring from October 2007 and a fall in the value of residential property in the second half of 2008 and in most of 2009.
“Since 2009-10, receipts have increased both in terms of annual revenue and as a proportion of GDP. Receipts increased substantially in 2015-16 as a result of rising asset values and a higher number of deaths in the final months of 2014-15 compared to the same period in previous years.”
Through careful planning, IHT can be mitigated. Our Beavis Morgan tax experts are available to guide you and advise on the available strategies.
If you would like to know more, please contact Barrie Dunning or your usual Beavis Morgan Partner.
