Inheritance tax is a political hot potato, often discussed, but rarely changed.
Relatively few people actually pay the tax, but many think they will – either owing to its complexity or because they aspire to be suitably wealthy to end up paying.
So how does it work and is there a chance it will be abolished?
So how does it work and is there a chance it will be abolished?
It is a tax on the estate – in other words, the property, possessions and money – of somebody who has died.
It is charged at 40%, but only on the part of the estate that lies above a certain value threshold. So if the estate is worth £10,000 above the threshold, then the tax is 40% of the extra, not the total amount.
It must be paid by the end of the sixth month after the person’s death, otherwise interest will be charged too.
The thresholds are where some of the complexity comes in as, for example, there is an extra allowance for passing on a home to children or grandchildren.
Inheritance tax is a political hot potato, often discussed, but rarely changed.
So how does it work and is there a chance it will be abolished?
Relatively few people actually pay the tax, but many think they will – either owing to its complexity or because they aspire to be suitably wealthy to end up paying.
It is a tax on the estate – in other words, the property, possessions and money – of somebody who has died.
So how does it work and is there a chance it will be abolished?
So how does it work and is there a chance it will be abolished?
It is a tax on the estate – in other words, the property, possessions and money – of somebody who has died.
It is charged at 40%, but only on the part of the estate that lies above a certain value threshold. So if the estate is worth £10,000 above the threshold, then the tax is 40% of the extra, not the total amount.
It must be paid by the end of the sixth month after the person’s death, otherwise interest will be charged too.
The thresholds are where some of the complexity comes in as, for example, there is an extra allowance for passing on a home to children or grandchildren.
#inheritance #tax #cut
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