UK Inheritance Tax bill hits £5.9 billion
Inheritance tax receipts for April 2022 to January 2023 are £5.9 billion, which is £0.9 billion higher than in the same period a year earlier, according to the latest data from HMRC.
In 2019/20 the average inheritance tax bill was £216,000, but that average could reach almost £271,000 by 2025/26 and £289,000 by 2027/28 if current inflation expectations are met, according to recent predictions.
The rise is partly due to the frozen nil rate band and asset inflation. That nil rate band will remain frozen until at least 2028; the last increase was in 2009!
It is estimated that 10,000 additional families could end up paying inheritance tax in the short run, while the Treasury could receive nearly £8 billion a year over the next few years.
If you have valuable assets, particularly residential, investment or business property that should be the impetus to at least commission a health check by your professional adviser.
Have a look at my ‘Fixed Fee Inheritance Tax Review’ and ‘Specialist Inheritance Tax Report’ for examples of what might be required –
It may be anticipated that currently about one in 25 deaths results in an inheritance tax liability. That is set to rise. With inheritance tax at a flat rate of 40%, finding yourself in the wrong place at the wrong time can really eat into what you leave behind. If you and your family are interested in succession, then passing on a mere 60% of your estate is probably not the best way to structure matters. If in doubt, ask the family what they think.
HMRC’s latest data may be found at: