Inheritance tax traps to avoid

Inflated house prices have resulted in more people paying inheritance tax (IHT), which earned the UK Government a record £7.1bn in the last financial year. Frozen tax thresholds are also dragging a growing number of families into paying the tax. IHT is typically levied at a rate of 40% on the value of an estate above the "nil-rate" allowance of £325,000 (£500,000 if you leave your main home to a direct descendant). The £325,000 threshold has not been raised since 2009, despite years of house price rises and asset inflation. Claire Roberts from Moore Kingston Smith says that wills can become complex and if they are not structured right then you can be double taxed. Chris Etherington of RSM UK provides advice on the pitfalls that can reduce the residence nil-rate band. 

The Sunday Times (14/05/2023)