HMRC reports Inheritance Tax receipts last year rose to £3.4 billion
HMRC has today (Thursday 31st July 2014) reported that the total amount of Inheritance Tax levied in the 2013/14 Tax Year rose to around £3.4 billion. This represents an increase of 8.6% on 2012/13, and around 17% since 2011/12, writes Gareth Tregidon, Financial Planning Manager at Swansea-based accountants and financial planners, Bevan & Buckland.
Last week a study published by unbiased.co.uk suggested that as much as £530 million is set to be ‘wasted’ in Inheritance Tax this year by individuals not placing life policies under trust. According to the website this figure has risen by £58 million compared to the previous year. However the latest announcement by HMRC suggests the majority of the tax arose from properties, household savings and securities.
The Nil Rate Band, the amount that can be passed on free of the tax, has been frozen at £325,000 since April 2009. With the economy continuing to recover, and values of properties, investments and other assets increasing, it seems certain that the number of estate paying IHT will continue to increase.
Separate research conducted by Close Brothers suggests that less than half of those liable to the tax know the correct threshold and potential liability, meaning that many people may not even realise their estate could be affected.
There are some relatively simple steps individuals can take to make sure that assets end up with the people you intend after your days, and often this can have the added benefit of reducing any tax due as well. It is particularly important to check any insurance policies or investments that make a payment on death, as writing these benefits under a trust can be a simple, low cost way of reducing the tax your beneficiaries would have to pay.
Former Chancellor of the Exchequer Roy Jenkins is famously quoted as having said, “Inheritance tax is a voluntary levy, paid by those who distrust their heirs more than they dislike the Inland Revenue.” As you would expect from one of South Wales’ leading tax and financial planning firms, we have the experience and expertise to help you assess if anything needs to be done, and then to help you take the necessary actions. We offer a free, no obligation initial meeting, so why not give us a call today to see how much you could save.
Financial Planning | Bevan Buckland Blog
Gareth Tregidon is manager of Bevan & Buckland’s Financial Planning Department, which operates from the firm’s Swansea, Pembroke and Haverfordwest offices. The department provides fee-based advice to personal and business clients, both from within the firm and elsewhere.
Gareth is a Certified Financial PlannerCM and an accredited Later Life Adviser with the Society of Later Life Advisers (SOLLA). He is former Chairman of the Institute of Financial Planning in South Wales, and an assessor for the internationally recognised Certified Financial PlannerCM licence.
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