In a budget which has been dominated by planning for the economic impact of coronavirus, we had also expected to see some changes to Inheritance Tax. Surprisingly, although changes were announced to Entrepreneurs relief, Inheritance Tax was not mentioned. The Office of Tax Simplification has suggested some wide-ranging changes to Inheritance Tax, which brought £5.4 billion into the government’s coffers last year.
Suggestions from the Office of Tax Simplification had included changes to lifetime giving, changes to the way Inheritance Tax interacts with Capital Gains Tax and consideration of the treatment of Businesses and Farms benefiting from Business Property Relief and Agricultural Property Relief.
Inheritance Tax can be complex and there are a number of specific reliefs available to reduce the tax payable. We cannot be sure that these reliefs will be retained, and we do know that the spending plans outlined by the chancellor will need to be paid for somehow.
