HMRC has Inheritance Tax in its sights says Haslers
New research has revealed that HM Revenue & Customs (HMRC) has launched almost 3,600 investigations into Inheritance Tax this year – collecting an extra £254 million from estates in the UK.
In response to these findings, Loughton chartered accountancy firm Haslers is calling on families to seek professional advice when preparing a Will and passing their estate to family, friends and other beneficiaries.
Inheritance Tax (IHT) is often only paid by high-value estates, typically valued at over £1 million for couples, thanks to the various allowances and reliefs on offer. such as the nil rate band allowance.
However, in recent years, the amount of tax collected has increased, especially in the South East due to rising house prices, which has pushed many estates into the tax regime leading to significant bills after a person dies.
To make matters worse, the latest study by law firm Pinsent Masons showed that many people are taking IHT matters into their own hands and failing to seek professional advice, resulting in HMRC recovering increasingly large sums of tax from deceased estates.
“According to the data that has recently been published, each investigation is netting HMRC around £71,000 in additional Inheritance Tax,” said Paul Reynolds, Tax Partner at Haslers Chartered Accountants.
“The fact that people are choosing to take IHT planning into their own hands is slightly concerning, as the rules around this tax are complex and often take years of preparation to significantly reduce a potential bill.”
Key mistakes made by many handling their estate planning includes undervaluing of a property, failing to disclose valuable assets during the probate process and taxpayers making invalid claims for inheritance tax reliefs.
Paul added: “The fact that HMRC is so active in this area shows that they view IHT as an easy target for recovering revenue.
“Seeking out professional advice on IHT could offer families greater peace of mind and help more wealth to be passed on while eliminating the stress of a tax investigation.
“The last thing anyone wants to deal with while they are grieving is a letter from the taxman saying that the inheritance they have received is being investigated.”
If you would like assistance with Inheritance Tax and estate planning issues, please visit www.haslers.com
HMRC has Inheritance Tax in its sights says Haslers
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