Date posted: 9th Aug 2023
There are rumours circulating in the press of the possible abolitshment of inheritance tax (IHT) in a bid by the Government to secure the support of wavering Conservative voters.
This may cause some individuals to delay IHT planning, but remember these are just rumours, and it may not actually happen.
It should be noted that under the current IHT rules there are a number of generous reliefs and exemptions that may also be abolished but given that the Government will be under pressure to replace the £2bn loss of IHT receipts, elsewhere, it could see a rise in other taxes or perhaps the introduction of a wealth tax.
For example, business property relief is available on the transfer of shares in an unquoted trading company during lifetime or on death, such that no IHT would be payable. However capital gains tax potentially applies to a lifetime transfer of shares, subject to a possible claim to hold over the gain. Could holdover be abolished to generate a capital gains tax receipt for the Government?
So, the current rules allow tax planning to be undertaken with an element of certainty, as opposed to speculating about possible future changes.
We will keep you informed of any changes to IHT. Please talk to us if you would like to discuss inheritance tax planning.
