Scottish Widows have warned that one in three households will be affected by inheritance tax over the next twenty years, and 68% more estates this year will pay inheritance tax this year than a decade ago. Domestic estates paid out £2.9 billion in tax to the Revenue last year, which is more than the government took in capital gains tax over the same period.
The proportion of people facing inheritance tax is higher in London than the rest of the country, with the average house price in the capital costing around £300,000 according to Land Registry data, which is over the £275,000 IHT nil-rate band. The providers' research shows that 57% of households have taken no steps to reduce their liabilities. Around 45% of people believe that they have assets over the threshold, and the same number expects to inherit between £50,000 and £100,000 within the next ten years.
Our view
There are many, many ways to reduce or plan for this tax. Visit our Inheritance Adviser.com site and then contact us for some expert Inheritance Tax planning advice.