Inheritance As a result of Rishi Sunak’s tax raid, more people are facing IHT bills.
A SIZEABLE PERCENTAGE OF Britons over the age of 55 have no idea how Inheritance Tax (IHT) will effect them after they die. Do you understand how the government’s “death tax” would affect your loved ones?
According to a survey conducted by investment management TIME Investments, approximately one-third of over 55s in the UK have not considered how inheritance tax (IHT) would affect their assets after death.
Despite the fact that 36% of the 1,019 individuals polled believe their estates are worth more than the present tax-free exemptions,
When an individual dies before any assets are passed down to dependents, IHT is frequently imposed.
It is now levied at 40% on portions of an estate valued above £325,000.
A person’s estate can comprise their home, certain goods, and even cash in the eyes of HMRC.
HMRC will begin adding interest to the estate’s debt if the tax is not paid by the end of the sixth month after the person’s death.
IHT payable on the estates of the recently deceased brought HMRC £5.4 billion in revenue in the 2020/21 tax year.
According to the government’s own calculations, this constitutes a four percent increase, or roughly £190 million, over the previous tax year.
Chancellor Rishi Sunak confirmed his plan to freeze both the nil-rate and residence nil-rate bands until April 2026 in the 2021 Budget.
This particular action is expected to raise an additional £985 million over the next five years.
According to TIME Investments’ research, more than half of over-55s in the UK are unaware of their potential IHT duty.
Only 25% of those polled by the firm were aware of their possible liability, while another 23% were convinced that they would not have any IHT to pay when they died.
According to the age demographic, 36% believe their estate would be valued more than £325,000, the current nil-rate threshold.
Another 20% estimate their estate is worth more than £500,000, which is the current residential nil-rate band allowance.
According to research, property continues to account for the bulk of people’s assets in the United Kingdom.
Over 55s account for about a third (31%) of the population. “Brinkwire News in Condensed Form.”