Record inheritance tax take for HMRC

23 Sep 2019

HMRC collected a record sum of £5.4 billion in inheritance tax (IHT) during the 2018/19 tax year, according to figures released by the tax authority.

The increase comes on the back of a 15% rise in the number of estates liable for IHT. Between 2015/16 and 2016/17, the number of estates paying IHT rose by 3,600 to 28,100.

Rising asset values, particularly in regard to properties in London and the South East of England, have been a key factor behind the increased number of estates falling into the IHT net. The freezing of the tax-free nil-rate band threshold also played a key role.

The residence nil-rate band (RNRB) gives an additional allowance to people leaving their family home to direct descendants, such as children or grandchildren. The amount of relief is £150,000 for 2019/20, rising to £175,000 for 2020/21.

Despite the increase in estates paying IHT, the tax only applies to 4.6% of deaths in the UK. The average amount of tax paid in 2018/19 was £179,000.

The figures also revealed that only 3% of estates falling into the scope of IHT in 2016/17 were valued at £1 million or more, and they accounted for 72%, or £3.4 billion, of the total IHT take of £5.1 billion.

In July, the Office of Tax Simplification (OTS) proposed several changes to IHT, although it did not make any recommendations in regard to the RNRB.

Home | Contact us | Privacy Policy | Disclaimer | Help | Site map | Accessibility | Anti-slavery policy |

© 2024 Dendy Neville Limited. All rights reserved.
Dendy Neville Limited, 3 - 4 Bower Terrace, Tonbridge Road, Maidstone, Kent ME16 8RY

We use cookies on this website, you can find more information about cookies here.


Registered to carry on audit work in the UK and regulated for a range of investment business activities by the Institute of Chartered Accountants in England and Wales. dendy neville is a trading name of Dendy Neville Limited, a company registered in England and Wales, company number 6219954.