Inheritance Tax receipts hit record amount

Recent figures published by HMRC show Inheritance Tax (IHT) receipts reached a record £5.4 billion for the 2018/19 tax year.

The increase comes on the back of a 15% rise in the number of estates liable for IHT, with the average IHT bill reaching £179,000.

Rising asset values, particularly in regard to residential properties, has been a key factor behind the increased number of estates falling into the IHT net. The rise also reflects significant fiscal drag as the IHT threshold has remained at £325,000 since 2009.

The residence nil-rate band (RNRB) came into effect in 2017 and gives an additional allowance to people leaving their family home to direct descendants, such as children or grandchildren. The amount of the RNRB is £150,000 for 2019/20, rising to £175,000 for 2020/21. However, the introduction of the RNRB does not appear to have halted the rise in IHT receipts.

Craig Walker, Senior Tax Manager at Hawsons, commented: “Inheritance tax receipts have rocketed in recent years due to the freezing of the IHT allowance and rising asset values.”

“As the total amount collected hits a record high, so does the value of careful IHT tax planning.  Taking proactive advice is essential to mitigate exposure and to increase the amount that loved ones will receive.”

For more information on IHT planning please get in touch.

How can we help

To find out more about how one of the leading firms of accountants and tax advisors in Sheffield, Doncaster and Northampton can help you, please contact one of our tax specialists. 

Whatever your age or the size of your potential estate, Hawsons can advise steps you can take to mitigate your Inheritance Tax exposure, through lifetime transfers of assets and tax efficient structuring of Wills.

If you would like to book a free initial meeting with us to discuss your circumstances click here.

If you would like to see more information about our inheritance tax planning click here.   

More from our tax experts

You can find all of our latest tax articles and tax resources here.

If you are looking for advice in a particular area, please get in touch with your usual Hawsons contact.

Alternatively, we offer all new clients a free initial meeting to have a discussion about their own personal circumstances – find out more or book your free initial meeting here. We have offices in Sheffield, Doncaster and Northampton.