Market growth means many more pay inheritance tax
Thu 16th Aug, 12:31:20 BST
The continued growth of the UK property market is leading to increased numbers of Britons being caught out by inheritance tax (IHT) charges, experts have claimed.
While Gordon Brown raised the threshold level for IHT from £285,000 to £350,000 in his last budget as Chancellor, this will not come into effect until 2010, meaning that until then many owners of modest-sized properties will be liable to pay the charge.
According to Alex Pegley, director of the independent financial advisors Calcius, rising house prices are leading to IHT being charged for people who the tax "is not supposed to be hitting".
"The ones that I think will be increasingly caught are the ones with more modest homes, like three-bedroomed semis, because people with bigger homes come and see their IFA whereas those with more modest homes don't think it will happen to them," he said.
Mr Pegley added that he felt it unlikely that the increase in the IHT threshold would keep pace with house price inflation.
According to the latest report from the Department for Communities and Local Government, the average UK home cost £214,222 in June.
While Gordon Brown raised the threshold level for IHT from £285,000 to £350,000 in his last budget as Chancellor, this will not come into effect until 2010, meaning that until then many owners of modest-sized properties will be liable to pay the charge.
According to Alex Pegley, director of the independent financial advisors Calcius, rising house prices are leading to IHT being charged for people who the tax "is not supposed to be hitting".
"The ones that I think will be increasingly caught are the ones with more modest homes, like three-bedroomed semis, because people with bigger homes come and see their IFA whereas those with more modest homes don't think it will happen to them," he said.
Mr Pegley added that he felt it unlikely that the increase in the IHT threshold would keep pace with house price inflation.
According to the latest report from the Department for Communities and Local Government, the average UK home cost £214,222 in June.
News Home
Print Send to a Friend Discuss in Forum RSS Feed
Share this article:
Digg it Del.icio.us Reddit Newsvine Nowpublic