Pre Budget Report 2009 - Inheritance Tax

Several years ago increases in the IHT threshold were announced for an extended period, ending with a jump from £325,000 to £350,000 on 6 April 2010. The Chancellor has now decided that this increase will not happen: the threshold will be held at £325,000 (effectively £650,000 for a married couple or registered civil partnership) for 2010/11.

Because of falls in property values, only 1 in 40 estates were liable for IHT in the last year. Freezing the allowance will bring more estates into charge when the economy begins to recover.

The rate of IHT remains at 20% (lifetime) and 40% (chargeable on a death transfer).

Designated Members : M.J. Jay, F.C.A. • P.E. Farrow, F.C.C.A., A.C.A. • J.W. Hall, F.C.C.A., A.C.A. • J.R. Turner, Dip. P.F.S., A.I.F.P. • R.D. Gray, A.C.I.B. • S.J. Edwards, A.C.A.
Member: S.T. Boote, B.Sc (Econ), F.C.A.

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