Kingswood comments on ongoing increase of IHT receipts

Commenting on the ongoing increase of IHT receipts, Ketan Patel, Vice President – Wealth Planning at Kingswood said:

“IHT receipts have reached £2.1 billion between April 2021 and July 2021, representing a 31% increase from the same period last year. HMRC indicate that higher receipts are to be expected due to higher volumes of wealth transfers that have taken place during the COVID-19 pandemic. These sobering statistics, coupled with rising property and asset valuations, mean IHT receipts are likely to continue increasing. The fact that the nil rate band and residence nil rate band are currently frozen until April 2026 – referred to as a stealth tax – is likely to compound the issue.  There is also a concern that both IHT and CGT rates could increase in the post-pandemic era as the Government considers options for increasing tax revenue.

“The need for planning is therefore greater than ever. There are various options for IHT mitigation, which can range from simple to complex, that can be considered by families to help reduce their potential IHT liabilities. As holistic wealth planners, we can also assess the impact and risks of potential tax changes across the different tax regimes, whether this is income tax, CGT and IHT, on a client’s overall asset base. By focusing on the client’s objectives, we can discuss the planning opportunities with clients and their families, prioritise areas of action, and develop personalised strategies for them.”

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