Research has revealed that inheritance tax receipts have grown by over 18% since the start 2017.
According to NFU Mutual, £2.4 billion was collected from estates between April and August of this year, despite the introduction of measures to reduce the level of tax incurred. Launched in April, the residence nil rate band provides families with an extended tax free threshold, as long as they are passing their main residence on to their direct descendants.
Commenting on the figures was chartered financial planner at NFU Mutual, Sean McCann.
“Despite the introduction of the new tax break, inheritance tax appears to be hitting families harder than ever before. Receipts have risen by almost 20 per cent and it’s clearly the result of an ever-more complicated tax system and a more aggressive approach from the taxman.”
He also drew attention to the complexity of the system, with certain aspects such as spousal transferability not being made clear enough and therefore acting as a barrier for families.
Whilst a carefully drafted will has been hailed as one of the key ways to reduce the amount of inheritance tax incurred, legislation surrounding wills is similarly under scrutiny.
A consultation has been launched by the government to establish how the existing law could be amended, with a view to bring it up to date and potentially implement the use of technology.
The main aim is to encourage more people to write their will at an earlier stage, and ultimately to minimise the risk of dispute later down the line.
The Law Commission are encouraging professionals to contribute to the consultation before it closes on 10 November. It can be accessed here.
