THE YIELD taken from families paying inheritance tax has hit a six-year high, official figures show.
Families were charged £3.4bn in death duties last year, an increase from £3.1bn in the previous 12 months, the Office for National Statistics said. The total was only slightly below the £3.5bn anticipated by the Office for Budget Responsibility, the government’s financial forecaster.
HM Revenue & Customs received a similar windfall in its inheritance tax take in 2007/2008, when a record £3.8bn was paid.
Takings dropped substantially to £2.4bn in 2009/2010, when the government allowed people to pass their allowance to their spouse on death, but have risen for four consecutive years since. The threshold at which the 40% IHT charge is triggered has been frozen at £325,000 per person since 2009.
Collections are up because of rising property prices and static allowances, the ONS said.
“Residential property makes up approximately a third of the total value of taxpaying estates and the ongoing rise in property prices has contributed to a rise in overall tax take,” it said in a statement.
“At the same time, as the average value of estates rises, an increasing number of estates will now be valued over the IHT threshold (or nil rate band), which has been frozen at £325,000 since April 2009.”
Making Tax Digital responses to the consultations expected in January 2017
Further corporation tax cuts and reliefs for cutting-edge tech businesses have been pledged by prime minister Theresa May, ahead of Wednesday’s Autumn Statement
The UK has not followed the global trend for reducing income tax over the past two decades
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