Ami Jack, Head of National Tax at Smith & Williamson shares her thoughts following the publication of the latest HMRC tax receipts and National Insurance contributions for the UK (Monthly Bulletin).
Ami Jack, Head of National Tax at Smith & Williamson comments:
“Newly published data from HMRC shows that IHT receipts for April to June 2021 were £1.5 billion – £0.4 billion higher than the same period a year earlier. This 33% year-on-year rise indicates that IHT collections are starting to become more lucrative for the Treasury, at a time when it is far from certain how the pandemic will pan out in the coming months and what the final bill to fund the Chancellor’s economic support schemes will turn out to be.
“For some time there has been an expectation that an Autumn Budget was on the cards, which could have been an obvious time to introduce tax reforms to help pay for the cost of the pandemic. More recent rumours swelling around Westminster, however, suggest that a Spring Budget may be more likely to allow the Treasury to take stock of the economic impact of the current wave of Coronavirus. Whatever the date of the next Budget, families should take the opportunity to give serious thought to their tax planning and make the most of their current allowances before possible reforms are introduced.
“It should be remembered that both the nil rate band and residence nil rate band have already been frozen until at least April 2026, meaning many families are already receiving increased IHT bills due to rising property and share prices. By considering options such as making gifts and investing tax-efficiently, there are a number of areas of tax planning that may help reduce or eliminate an IHT bill.”