Inheritance tax payments hit record £5bn for 2017-18
The latest official figures from HMRC reveal the British government received over £5bn in IHT receipts last year.
Total IHT receipts have almost doubled since 2010-11, having risen by 10% year-on-year on average since 2009-10. The ongoing increase has been driven by rising asset values and the freezing of the nil-rate band since April 2009.
Laura Suter, personal finance analyst at AJ Bell, commented: “Freezing rate bands is an age-old Government trick to stealthily boost receipts as asset values rise and more people are dragged into paying tax.
“When it comes to IHT, this has happened through a freezing of the so-called nil-rate band in 2009/10 at £325,000. It has remained at this level in the 8 years since, meaning more and more estates are being hit with IHT bills on death as the value of their estates – particularly property – have risen post-crisis.
“An additional residence nil-rate band of £100,000 was introduced in 2017-18, rising to £175,000 by April 2020. This means that a couple will be able to pass on an estate worth £1m without paying any IHT at all.
“IHT is an extremely complicated area and one where getting expert advice is absolutely essential to ensure your assets are sheltered from the taxman.”