IHT receipts at highest ever yearly level

Receipts for inheritance tax (IHT) have reached their highest ever level over a 12-month period, new data published by HMRC has revealed.

The latest government figure showed that IHT receipts reached £539m during June, meaning the Treasury has now collected £5.7bn in IHT receipts over the last year.

HMRC’s figures also confirmed that IHT receipts for the three-month period between April and June hit £1.5bn, which was £0.4bn higher than the same three months in 2020.

IHT has existed from the tax year 1986 to 1987 onwards.

Commenting on the latest government numbers, Canada Life tax and wealth specialist, Neil Jones, said: “The freezing of the IHT nil rate bands is even more significant as clearly more tax is being collected and with investment markets and property prices continuing to rise, we will expect receipts to continue rising. This landmark was not mentioned in HMRC’s narrative.”

Jones added that effective estate planning allows an adviser to demonstrate the benefit of financial advice.

He continued: “The need to plan is more important than ever and if someone is willing to take action they can reduce the amount of inheritance tax payable when they die. If they chose not to do anything then the beneficiaries of the estate should consider taking action themselves.

“This could be as simple as life cover to provide a lump sum to meet the liability: simple, effective and often overlooked.”

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