“‘IHT is no longer only a concern for the wealthy’”

Jan 9, 2025 | Tax

An independent (financial adviser’s) view

Broad brush, if you’re married, have kids and are passing your home on to them, your worldly worth can total £1million before IHT is payable at 40% on anything more. I did hear this week that flats in a new development in City of Culture Bradford are on for just £25,000, but for many, a house, certainly in the Cotswolds, will use up a fair bit of that £1m allowance. Add in other savings and now, of course, unspent pensions and it’s not hard to edge, or romp over. Don’t forget, the allowances have not increased with inflation since 2009! I’ve met a few over the years who’ve said ‘fine, we all have to do our bit, if there’s tax to pay, so be it.’ But for most, IHT is the most disliked of all taxes as it’s rightly felt that everything you have has already been taxed one way or another. What was originally intended to break the cycle of inherited wealth and big, landed estates is now very much a middle and not upper class tax. And, yes, we do still have a more-than-residual class system in this country. I’d say.

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