The Daily Telegraph has reported today that families have paid up to £600m in death duties after missing out on tax reliefs that could have slashed their inheritance tax bills. The Government is expected to raise record amounts from death duties in 2022 but families are not utilising IHT reliefs such as allowing spouses to transfer assets between one another tax-free or the ‘main residence nil-rate band’ or family home allowance.
Tax Director, Nigel Shaw says:
One complicating factor for so many families when claiming additional Inheritance Tax (IHT) allowances on a loved one’s estate is navigating the completion of form IHT435; this form needs completing if you wish to claim the Residence Nil Rate Band – which is worth up to £175,00 if certain specific circumstances are met. It’s a complicated form and I expect many Executors, especially those with no professional support, struggle to understand the implications of submitting the IHT435 and claiming further valuable relief from IHT.