Thousands of Brits could be left in the lurch as changes to inheritance tax are set to see HMRC pocket a whopping extra £800 million. Inheritance Tax receipts have skyrocketed, hitting a staggering new peak of £8.2 billion from April 2024 to March 2025.
Financial expert Jonathan Halberda of Wesleyan Financial Services warns: “With an increasing number of families being pulled into the scope of inheritance tax (IHT), the latest rise in receipts comes as little surprise.” He continues, highlighting the grim reality for many UK families: “Month-on-month, we’re seeing the impact of frozen thresholds that no longer reflect current asset values, alongside an increasingly complex system.”
Those with modest assets might find themselves in trouble, as Halberda reveals: “Many who wouldn’t have faced a tax bill just a few years ago are now being caught out, while others don’t realise their estate is at risk until it’s too late to plan.”
There are still avenues available for those looking to dodge the IHT bullet though, such as gift-giving, leveraging trusts, making arrangements for your significant other and, crucially, putting together a Will.
Married couples and people in civil partnerships get the perk of passing on their entire fortune – home included – to their significant other without IHT worries, even if their amount goes beyond the usual £325,000 limit, reports Birmingham Live.
But here’s the kicker for unwedded duos: no matter the length of their partnership or the joint finances, that exemption is off the table.
That means without nuptial or civil partnership vows, if one half inherits assets from the other, they might just stumble upon a hefty tax bill.
Consequently, numerous couples opt to tie the knot or enter into a civil partnership as part of their comprehensive inheritance planning strategy.
This allows them to benefit from this exemption, potentially saving substantial amounts in inheritance tax that would otherwise be levied on their estate.
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