Friends provident research finds most think inheritance tax is unfair
Research commissioned by Friends Provident has shown that although most people in the UK survey would like to see the government abolish inheritance tax, most do not seek advice by intermediaries to minimise payment.
The study revealed that eight out of 10 people claim that inheritance tax is grossly unfair. More than six out of 10 of those questioned in the poll said they should have the right to pass on the total value of their main abode to a beneficiary without paying tax.
However, although most people believe that inheritance tax is unfair, less than 10% seek professional financial advice in order to minimise their family's liability to pay inheritance tax in the event of their death.
Inheritance tax is currently set at £275,000 and is paid at a flat rate of 40% above the threshold, irrespective of how much wealth a person has.
Ian Jeffries, head of investment marketing at Friends Provident, said: "The majority of families will now find themselves drawn into the inheritance tax net because of the housing boom in recent years. That is why inheritance tax planning should be a key consideration for those families who, until recently, were not liable for this tax."
Almost eight out of 10 people think the current inheritance tax system should be reformed, preferring a banded system similar to income tax. Seven out of 10 of survey respondents believe the tax on inherited wealth should be set at a higher level.
On the other hand, the Chancellor's recent threshold rise has been met with support from some quarters. Almost two out of 10 people believe that Brown set the level correctly in the recent budget, and the same number again think inheritance tax is fair.
Paul Bruns and Elaine Parkes
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Record numbers of people aged 90 plus
From 3 to 10 October