Inheritance Tax (IHT)
The 2016 Autumn Statement brought no new announcements on the IHT front.
It was however previously announced that the IHT nil-rate band, which is the amount of a person’s estate that is not taxable on death, has been frozen at £325,000 until 2020/2021.
There is also to be a further tax-free amount to cover a person’s main residence if passed down to a direct descendent (i.e. children or grandchildren).
This main residence nil-rate band will be introduced at £100,000 in 2017/2018 and will gradually increase up to £175,000 by 2020/2021. This amount is transferable to a surviving spouse or civil partner, like the existing nil-rate band, but will be reduced for net estates of over £2,000,000 at a rate of £1 for every £2 over the threshold.
IHT can be a complex matter, however planning can be undertaken to ensure your exposure to any liabilities is minimised. If you would like to review your position please do not hesitate to contact one of our Tax Specialists on 01228 711888.