HMRC Inheritance Tax receipts continue to rise
30 April 2019
Inheritance tax receipts have hit a record high, according to the latest official figures.
Data from the HM Revenue & Customs showed that receipts rose to £5.4 billion in the 2018/19 tax year, from £5.2 billion the previous year.
The figures, dating back to 1980-81, showed a steady rise until 2007-08 as a result of increases in the value of tax-liable assets during the period. The introduction of the Transferable Nil Rate Band for deaths in October 2007 and a fall in the value of residential values in the second half of 2008 saw the level of receipts fall sharply. However, the decline proved short-lived, with receipts climbing both in terms of annual revenue and as a proportion of GDP since 2009-10 (see chart below).
Neil Jones, wealth management and tax specialist at Canada Life, said: “It is another record year for the amount paid in inheritance tax. This continues a consistent, long term trend of increases that shows little sign of slowing down. Just as consistent is that a lot of these payments are preventable. Death and taxes may be the only two certainties in life, but with careful planning around the former, some of the latter is unnecessary.
“Starting any planning early is essential and there’s a range of trusts available that can enable clients to make sure more of their money goes to beneficiaries whilst reducing the amount of tax payable when they die.”
Paul Latham, head of tax products at Octopus Investments, said people should consider alternatives for their money to prevent it becoming subject to a large tax grab.
He commented: “There are lots of other opportunities for people to do good things with their money that the government supports, through redirecting revenue that would otherwise go into the general spending pot from IHT.
“It could be giving to a charity, investing in early stage companies that stimulate the UK economy by creating jobs, or reducing global warming through renewable energy. Through receiving proper financial advice, £60 invested into a “good cause” can be the equivalent to a £100 investment that is subject to IHT.”
Origo is to launch Unipass Letter of Authority (ULoA) at the end of November, a service aimed at simplifying...
Kim Bendall has launched her own firm, Go Paraplanning, and is looking to provide tailor-made support services to new...
While the aggregated costs and legacy trail commission regime remains far from perfect, some clarity can be gleaned, says...