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News - 2 August 2013

Inheritance Tax: some information that may surprise you.

According to figures from the Office for National Statistics (ONS), 259,989 estates went through probate - the process of legally distributing a person's estate after their death - in 2010-11, accounting for nearly half of all deaths. Of these, 15,584 were liable for inheritance tax.

A recovery in property prices and HMRC's drive to collect the tax has resulted in an annual inheritance tax collection that comes close to the record £3.8 billion collected in 2007/08.

Inheritance tax receipts were around £3.14 billion in the tax year to April 2013, an eight per cent rise compared to the previous year, and larger still than the year-on-year growth recorded between 2010/11 and 2011/12.

The decision to freeze the inheritance tax threshold at £325,000, where it has been since April 2009, has also helped boost the amount collected.

Stuart Coleman, Manager of the Tax Department of ABDS comments:
“Looking at data from the ONS, up until 2007/08 receipts had been climbing steadily, reflecting increases in asset prices over this period, specifically property prices and household savings. However, Inheritance tax dropped after this period following the introduction of the transferable nil rate band, where any unused nil rate band from the first death within a marriage or civil partnership can be claimed against the estate on the second death."

Stuart continues:
“…….but in the year 2012/13, Inheritance tax has increased again costing families and individuals more than £3 billion.”

If you need any help and advice on Inheritance tax or capital gains Tax, don’t hesitate, contact Lavinia Newman, Stuart Coleman or Tonmoy Kumar NOW to discuss how ABDS can help in all your financial planning.

ABDS Chartered Certified Accountants of Southampton.
Tel: 023 8083 6900  E-mail: abds@netaccountants.net

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