Inheritance tax exceeds £5 billion for the first time
Recently released data from HM Revenue & Customs shows inheritance tax (IHT) raised a record £5.2 billion in the 2017-18 financial year, up 8% from the previous tax year.
What accounts for the rise?
Property prices have continued to rise despite the fact the residential nil-rate band (RNRB) - the value of a property which people will pay IHT on - has not changed from £325,000 since 2009. This has resulted in more and more properties exceeding the rate bands in recent years.
Key information from the report:
- In 2015-16, 4.2% of UK deaths were liable to IHT, increasing slightly by 0.3% since 2014-15. This highlights the long-term increase since 2008-09 and is partly due to freezing the RNRB (at £325,000) in April 2009.
- IHT receipts totalled £5.2bn in 2017-18; this is an increase of 8% (£388m) from the previous year and an overall steady rise since 2010-11. There was a 22% increase in receipts from 2014-15 to 2015-16, which reflects an estimated 43,900 excess winter deaths in 2014-15.
- Since 2009-10, the net capital value of estates has increased by £17bn to £79bn in 2015-16, around 54% of this increase is in residential property.
- The total number of liable estates has increased year on year since 2009-10. In 2015-16 there were 24,500 liable estates, an increase of 1,300 from 2014-15.
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