£8,000 rise in inheritance tax nil band

Estates with a value exceeding the threshold will be taxed at a flat rate of 40%, with the Treasury estimating this number at 23,000 for 2001/02, or 4% of all deaths.

In the 2000/01 tax year, roughly the same number of heirs paid an estimated Pounds 2bn on their inheritances.

Inheritance tax has come under criticism from a number of organisations, such as the Chartered Institute for Taxation, which says the way it is calculated is unfair, given the continued rise in property prices.

All wealth, including houses and gifts, inherited from a deceased person is subject to inheritance tax if it exceeds the threshold unless it inherited from a wife or husband, in which case it is exempt.


Budget 2001

Related reading