Among many changes, the OTS recommended replacing the current £3,000 annual allowance, marriage allowances and the exemption for regular gifts out of income with a £25,000 personal allowance each year.
There are numerous misconceptions about how the tax operates, particularly in connection with gifts during someone’s lifetime. One of the proposed changes is also to shorten the period for lifetime gifts to be exempt from seven to five years.
The government normally takes account of OTS recommendations and their report is likely to lead to future changes to the rules. We will keep you posted as the changes may necessitate amending your will or further planning to pass on your wealth.
Emma Robinson works within our private client tax team and has a background of providing bespoke tax advice for high net worth individuals and internationally mobile clients. With experience in complex tax returns, inheritance tax and trusts, she helps to ensure that we provide an all round service to clients – you can contact Emma or the team on 01242 776000 or email firstname.lastname@example.org.
Watch Emma’s short video for more information about Inheritance Tax and the importance of planning for the future for a more tax efficient outcome: