Making Inheritance Tax Digital

The Office of Tax Simplification (OTS) has been looking into a digital system for making probate applications easier by making inheritance tax applications digital rather than paper based.

Although the OTS feels a full digital system would be costly, they have suggested HM Revenue and Customs can help by making changes to the current time consuming forms for inheritance tax and helping improve instructions, making it easier for people to fill out forms and calculate death duties and taxes.

Just 25,000 Estates Need Complete IHT Forms

The research showed that whilst nearly 600,000 die each year in the UK, only around half of estates are required to complete probate.

The reality of probate is that inheritance tax forms and calculations need to be completed and signed off before probate can be granted.  This means that around 300,000 inheritance tax submissions are made each year, even if there is no inheritance tax due.   Last year, just 25,000 estates paid inheritance tax. 

This means of the 600,000 deceased estates, just 25,000 needed to complete inheritance tax forms and 275,000 inheritance tax submissions were simply a waste of time.