Inheritance tax - what you need to know
Published: 22/07/2019 By Martin ArmstrongThe number of investigations undertaken by HMR&C into Inheritance Tax (IHT) has risen by 8% (5,537 in 2017/18 compared to 5,138 in 2016/17) since a new allowance for a family home was introduced.
In April 2017 the Chancellor extended the IHT allowance if a property is passed on. Every individual is allowed to pass on £325,000 free of IHT. Above that your estate incurs a tax liability of 40%.
Since 2017 individuals had an additional £100,000 allowance for the family home.
This rises to £175,000 next year, meaning a couple could pass on a £1M family home without IHT.
HMR&C will launch an investigation if they believe someone has given away more than they are allowed to, or if the value of the property is greater than declared. HMR&C say “the majority of people pay the correct amount of IHT.
Investigations are opened into the small proportion of cases where irregularities have been identified”. (www.thesundaytimes/business).
It is invariably best to seek professional advice in order to avoid any issues. The TBA tax team will be pleased to help and always offer a free no obligation initial meeting.