Inheritance tax (IHT) receipts hit a record high of £5.2 billion in 2017/18, according to statistics published by HMRC.
This was a year-on-year rise of 8%, and continues a long-term pattern as IHT receipts have been increasing by an average of 10% a year since 2009/10.
The report says this is partly due to rising estate values, as well as the nil-rate band – the threshold at which people are liable to pay IHT on their estate – being frozen at £325,000 in 2009.
However, the figures do not yet reflect the full impact of the residence nil-rate band, which was introduced in April 2017 to provide an additional IHT allowance to eligible individuals passing on a family home to direct descendants.
As of April 2018, this additional allowance increased from £100,000 to £125,000.
Sean McCann, chartered financial planner at NFU Mutual, said:
“We’ve seen in recent years a more aggressive approach from the taxman that has driven a surge in IHT receipts.
“Simplification of this tax can’t come soon enough for many families, but taking financial advice should be a priority for anyone with a potential inheritance tax problem.”
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