Inheritance tax nets £5.1 billion despite rare fall
Inheritance tax receipts are down, but that doesn't mean estate planning is any less important.
30th July 2020 12:48
by Jemma Jackson from interactive investor
Inheritance tax receipts are down, but that doesn't mean estate planning is any less important.
Inheritance Tax (IHT) receipts have fallen for the first time in a decade (at least) but remain above £5 billion in the 2019-2020 tax year, according to the latest figures from HMRC published today.
IHT receipts totalled £5.161 billion in the last tax year – 4% less than the total for the 2018-19 tax year (£5.384 billion).
Commenting on the statistics, Moira O’Neill, Head of Personal Finance, interactive investor, says: “Whether the fall is a sign of an improvement in inheritance tax planning or a result of the bumper residence nil rate band, which has increased by £25,000 every year since the 2017-18 tax year and rose to £175,000 at the start of the current tax year, is hard to say.
“Soaring property prices and the stock market bull run over the past decade (pre-Covid-19) have dragged unassuming estates into the IHT territory. Trouble is, IHT is notoriously complex and riddled with anomalies and while the wealthiest can afford professional financial advice to take advantage of the exemptions and other ways to mitigate the IHT bill, those who can’t risk being caught out.
“No one likes confronting their mortality, and estate planning is unlikely to be a pressing concern for most. But as we get older, it is vital to consider IHT to ensure that more of your assets go to your loved ones and out of the taxman’s coffers.”
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Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.