HMRC nets record £4.3bn IHT haul


HMRC has taken in more than £4bn in revenues from inheritance tax for the first time, according to figures from the UK tax office.

Statistics published for the 11 months to February 2016 show the Government has benefited from the tax to the tune of £4.3bn.

Although revenues dropped substantially in 2008/09, falling by £1bn after the a previous record take of £3.82bn, sums taken in by HMRC have inched up ever since, returning to £3.8bn last year.

HMRC attributes this year’s bumper haul to increases in the values of assets left in estates, as well as the fact that the number of deaths between December 2014 and March 2015 was significantly higher than in the same period in previous years.

The figure comes after months of criticism of the Chancellor’s reforms to introduce a new IHT allowance of £1m for married a couples when including a home.

The changes, which are due to come into effect from next April, have been slammed by both Conservative backbenchers and Treasury committee chairman Andrew Tyrie, who warned in February they would add significant complexity, without substantially reducing the numbers of estates that pay IHT.

By the time the reforms come into full effect in 2021, the Institute for Fiscal Studies estimates the number of estates liable for IHT will have fallen by 40 per cent – from 60,500 prior to the changes to 34,200.

However, the IFS notes the proportion of estates liable remains relatively high compared with the last 40 years, and is set to reach 6 per cent in 2020/21.