Inheritance Tax changes explained

We are working closely with a number of our clients ensuring they are able to make the most of important changes to inheritance tax rules announced in the 2015 Budget.

If you own a property worth up to £1million, you can leave it to your children or grandchildren completely free of inheritance tax as from April 2020.

The former Chancellor, George Osborne, raised the IHT threshold from £325,000 per person to £500,000. This enables married couples and civil partners to pass on property of up to £1million without paying any IHT.

IHT is currently levied at a rate of 40% on the value of an estate above the tax-free threshold, which has been frozen at £325,000 per person since 2009.

Under the changes, couples can double the allowance, passing on assets to their children or other relations worth up to £650,000 before a tax charge is triggered.

Alan Mellor says: “We are advising our clients on the implications of the changes which were announced in 2015, but I know from speaking to other people that many people are not fully up to speed with the new thresholds.

“It is important that people plan ahead to get the benefit of the changes which will be phased in over the next couple of years. This applies equally to those who have a property worth over £2million or assets of more than £650,000.”

Alan Mellor can be contacted on 0151 353 1066.