TaxCorporate TaxPBR 07: Chiltern and Grant Thornton attack IHT moves

PBR 07: Chiltern and Grant Thornton attack IHT moves

Firms warn of unintended CGT effects and meaningless IHT changes

Chiltern and Grant Thornton have both rounded on chancellor Alistair Darling
for the changes to capital gains tax and inheritance tax announced in
yesterday’s pre-Budget report.

Ian Maston, director of IHT at Chiltern said doubling the IHT threshold for
married couples, civil partners, widows and widowers to £600,000, rising to
£700,000 by 2010-11, wouldn’t save people who had planned their affairs
anything.

‘Prudent people would have already arranged their Wills to achieve this
anyway, so the chancellor’s announcement won’t save them a penny,’ Maston said.

Heather Self, international tax partner at Grant Thornton said people doing
‘the most basic planning’ would have already enjoyed the benefit of the change
to the thresholds.

On the issue of CGT, Chiltern said that the abolition of taper relief would
hit small companies, employees and self-employed workers the hardest, rather the
just the private equity houses it was meant to target.

‘This will strike far beyond private equity,’ said Chiltern’s director of
corporate tax Bernard Sweet. ‘Many smaller companies, their staff and investors
will suffer as this relief is withdrawn. This could backfire on the government –
it is a blow to hard-working entrepreneurs.’

Self said that although scrapping taper relief was a ‘major simplification’,
it did seem as if the measure had been ‘rushed’ and not properly thought
through.

Further reading:

Business counts cost as Darling hijacks Tory
ideas

PBR 07: Tories slam Darling’s tax plans as ‘cynical
stunt’

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