The UK Inland Revenue's crackdown on inheritance tax (IHT) schemes and rising house prices has seen ...
The UK Inland Revenue's crackdown on inheritance tax (IHT) schemes and rising house prices has seen an increase in receipts of 16.09% to £2.91bn in 2004-05 compared with the previous year.
Gerry Brown, technical manager with Scottish Life International, said: "The dramatic increase in IHT receipts is largely a consequence of rising house values. The increase in the nil rate band announced in last month's budget will not compensate for the increase in asset values arising from house price inflation and the gradual recovery in share prices.
"The introduction of pre-owned asset tax on 6 April has made successful inheritance tax planning much more difficult. Intermediaries should be seizing this opportunity to promote tried and tested life assurance bond in trust strategies to their professional connections and therefore strengthening those relationships."
Presently, loan trusts can be used for investors who wish to undertake IHT planning. A loan trust is created with a lump sum which is provided in the form of an interest-free loan to the trustees, which is repayable on demand.
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From 1 March