Recent figures indicate that in the coming years, UK homeowners numbering in their thousands are likely to be faced with an Inheritance Tax (IHT) bill from Her Majesty’s Revenue and Customs (HMRC). While once IHT was mainly a concern of the wealthiest residents in Britain, a rise in house prices is now pushing many homeowners past the established nil band rate.
Statistics show that UK properties that are selling for over £500,000 are now making up close to a fifth of all British house sales. At present, UK legislation states that IHT must be paid on a person’s estate when they die on everything above £325,000, but with house values skyrocketing across the country, more Britons than ever are likely to face the compulsory levy.
UK consumers confused or concerned about IHT often look to experts in retirement planning in Shropshire, Derbyshire and other counties for advice and to put measures in place to mitigate the size of the tax bill their beneficiaries will face in the future.
Each year, IHT costs UK citizens billions of pounds, but this figure is set to increase dramatically over the next few years. In 2021, IHT claimed by the government rose in part due to the far higher death rates across the country caused by the COVID-19 pandemic.
House prices in Britain are now seeing gains of approximately 10 per cent each year. Currently, about one out of every 25 estates pay IHT, and affluent areas where home values are higher typically show more tax paid.