Inheritance tax is charged on a particular proportion of a person’s estate when they eventually pass away. It is likely to be the responsibility of those left behind to deal with the costs of the levy before they are able to receive an inheritance. But with an inheritance windfall being increasingly relied upon by many, Inheritance Tax and its rumoured changes, could present an issue.
Paying off debt, investing into a pension, and covering university costs for children were all examples cited by those asked when looking at inheritance.
The survey questioned over 2,000 people right across the country.
Andrew Bartle, founder and managing director of Tower Street Finance, commented to Express.co.uk on the matter.
He said: “We did learn some people plan to use an inheritance on a treat for themselves, such as holidays, or a new house or car.
“Our research revealed a staggering number of Brits are relying on a gift from a loved one to cover the cost of essentials, such as paying household bills and/or being able to retire in the future.
Mr Bartle concluded: “For those expecting more than £325,000 to be left to them, 20 percent admitted they had no idea anything above this could result in an Inheritance Tax bill. This needs to be paid upfront before any assets can be released.”
As reliance upon inheritance has increased, Britons may also be worried about the future of Inheritance Tax.
With the Chancellor’s Budget mere days away, the levy has been posited by experts as one which could be set for significant change.
In a recent interview with Express.co.uk, Christine Ross, Head of Advice at Handlesbanken Wealth Management, stated there could be certain areas where Mr Sunak chooses to act.
While it is unlikely the rate of IHT will change, there could be alterations on the table for giving and allowances.
She said: “If we’d not had a pandemic, a few people including myself, thought a year ago at the Budget we would’ve seen IHT changes. I still think we could see some changes surrounding Inheritance Tax going forward.
“Whether in the current climate the Chancellor really wants to look at something like that is still somewhat uncertain, but a tidy up could definitely happen.”
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