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Significant increase in homeowners liable for Inheritance Tax

Almost a quarter of homes sold for more than the Inheritance Tax (IHT) threshold last year, making their owners’ heirs liable to a 40% IHT bill. The number of sold properties valued above the £325,000 threshold increased to 24%, up from 13% in 2009.   

Research by Saga Investment Services showed that despite overall property sales falling by 3.7% between 2014 and 2015, the sale of properties worth more than £325,000 soared by 11.4% over the same period.

Postcodes in London and the surrounding areas were the ‘hotspots’ where the highest proportion of homes sold for over the IHT threshold. However, 28% of postcode areas outside the capital have seen property sales exceeding the threshold double since 2009.

The current IHT threshold means that individuals pay tax on estates worth £325,000 or more.  From next April, changes to the legislation mean that this allowance will be increased by an extra £100,000 per person, rising to £175,000 in 2020. This means that married couples and civil partners will be able to pass on £1 million to their beneficiaries without incurring inheritance tax charges.

Tom Curran, Chief Executive at Kings Court Trust said: “Soaring property prices have meant that the number of homeowners liable for IHT has grown significantly. Dealing with IHT can involve a significant amount of legal and tax work and if you get it wrong the ramifications can be serious as you are legally liable for the consequences.

The number of tasks families must complete following the death of a loved one creates an additional burden at a difficult time.  At Kings Court Trust we can deal with the whole estate administration process, including IHT on the client’s behalf. We take on full responsibility and liability so that they don’t have to worry; we also have a unique estate insurance policy which protects the family against any claims on the estate for ten years.”

 

Source

http://www.express.co.uk/