The Chancellor has today confirmed an inheritance tax cut which will allow married couples to pass on assets worth up to £1m, including the family home, to their children and grandchildren free of
The Chancellor has today confirmed an inheritance tax cut which will allow married couples to pass on assets worth up to £1m, including the family home, to their children and grandchildren free of inheritance tax.
Inheritance tax is currently charged at 40% of the value of your estate on death over the nil rate band which has been fixed at £325K since 2009. Starting from 6 April 2017 the inheritance tax threshold will increase annually by £100K in 2017/18, £125K in 2018/19, £150K in 2019/20 and £175K in 2020/21 thereby increasing the nil rate band to £500K per person by 2020/21. After that it will increase in line with the Consumer Prices Index.
Therefore, in effect, the tax free allowance for a married couple will increase to £1m by virtue of the transferable nil rate band to the surviving spouse.
The Chancellor has confirmed that he will protect people who want to downsize by providing an "inheritance tax credit" so that they will still qualify for the new threshold.
There will be a tapered withdrawal of the additional nil rate band for estates over £2m.
The Government estimates that 22,000 families will benefit from this measure by 2020.
Inheritance tax is currently charged at 40% of the value of your estate on death over the nil rate band which has been fixed at £325K since 2009. Starting from 6 April 2017 the inheritance tax threshold will increase annually by £100K in 2017/18, £125K in 2018/19, £150K in 2019/20 and £175K in 2020/21 thereby increasing the nil rate band to £500K per person by 2020/21. After that it will increase in line with the Consumer Prices Index.
Therefore, in effect, the tax free allowance for a married couple will increase to £1m by virtue of the transferable nil rate band to the surviving spouse.
The Chancellor has confirmed that he will protect people who want to downsize by providing an "inheritance tax credit" so that they will still qualify for the new threshold.
There will be a tapered withdrawal of the additional nil rate band for estates over £2m.
The Government estimates that 22,000 families will benefit from this measure by 2020.