{"id":14501,"date":"2025-06-21T01:59:33","date_gmt":"2025-06-21T01:59:33","guid":{"rendered":"https:\/\/lotayamedia.xyz\/?p=14501"},"modified":"2025-06-21T01:59:33","modified_gmt":"2025-06-21T01:59:33","slug":"inheritance-tax-hits-record-1-48bn-as-frozen-thresholds-bite","status":"publish","type":"post","link":"https:\/\/lotayamedia.xyz\/?p=14501","title":{"rendered":"Inheritance Tax Hits Record \u00a31.48bn as Frozen Thresholds Bite"},"content":{"rendered":"

UK inheritance tax (IHT) receipts<\/strong>\u00a0surged to\u00a0\u00a31.48 billion<\/strong>\u00a0in recent months\u2014a\u00a07% (\u00a398m) increase<\/strong>\u00a0from last year\u2014as\u00a0frozen tax thresholds<\/strong>\u00a0drag more families into paying the so-called\u00a0“most-hated tax.”<\/strong><\/p>\n

Why Is IHT Rising?<\/strong><\/h2>\n

\ud83d\udd39\u00a0Frozen thresholds until 2030<\/strong>\u00a0\u2013 The\u00a0nil-rate band (\u00a3325,000)<\/strong>\u00a0and\u00a0residence nil-rate band (\u00a3500,000)<\/strong>\u00a0remain unchanged despite rising property and asset values.
\n\ud83d\udd39\u00a0Pensions to be included from 2027<\/strong>\u00a0\u2013 Chancellor\u00a0Rachel Reeves<\/strong>\u00a0announced pensions will be subject to IHT, widening the tax net.
\n\ud83d\udd39\u00a0Soaring asset prices<\/strong>\u00a0\u2013 Homes, investments, and savings push more estates over IHT limits.<\/p>\n

Key IHT Facts<\/strong><\/h3>\n

\u2714\u00a040% tax rate<\/strong>\u00a0on estates over\u00a0\u00a3325,000<\/strong>\u00a0(or\u00a0\u00a3500,000<\/strong>\u00a0if leaving a home to children\/grandchildren).
\n\u2714\u00a0Married couples<\/strong>\u00a0can combine allowances, protecting up to\u00a0\u00a31 million<\/strong>.
\n\u2714 Only\u00a04% currently pay IHT<\/strong>, but the\u00a0Institute for Fiscal Studies (IFS)<\/strong>\u00a0predicts this will rise to\u00a07% by 2033<\/strong>.<\/p>\n

Who\u2019s Most Affected?<\/strong><\/h2>\n
    \n
  • \n

    Middle-class families<\/strong>\u00a0\u2013 Rising home prices push more into IHT territory.<\/p>\n<\/li>\n

  • \n

    Business owners<\/strong>\u00a0\u2013 Fear having to\u00a0sell family firms<\/strong>\u00a0to pay tax bills.<\/p>\n<\/li>\n

  • \n

    Pension holders<\/strong>\u00a0\u2013 From\u00a02027<\/strong>, pensions will be included in IHT calculations.<\/p>\n<\/li>\n<\/ul>\n

    Expert Warnings<\/strong><\/h3>\n
    \n

    Jonathan Halberda (Wesleyan Financial Services):<\/strong>
    \n“This is no longer just a tax for the wealthy. More families are being caught simply because their homes and assets have grown in value.”<\/em><\/p>\n<\/blockquote>\n

    \n

    Laura Hayward (S&W):<\/strong>
    \n“Frozen thresholds mean even modest inflation drags more people into IHT. The government may hike taxes further in the next Budget.”<\/em><\/p>\n<\/blockquote>\n

    How Can You Reduce IHT?<\/strong><\/h2>\n

    \u2705\u00a0Lifetime gifting<\/strong>\u00a0\u2013 Use\u00a0“normal expenditure out of surplus income”<\/strong>\u00a0rules.
    \n\u2705\u00a0Seven-year rule<\/strong>\u00a0\u2013 Gifts given\u00a07+ years before death<\/strong>\u00a0escape IHT.
    \n\u2705\u00a0Trusts & exemptions<\/strong>\u00a0\u2013 Seek\u00a0financial advice<\/strong>\u00a0to protect wealth.<\/p>\n

    Future Risks<\/strong><\/h3>\n

    \u26a0\u00a0Government may extend the 7-year gifting rule to 10 years<\/strong>\u00a0\u2013 making it harder to pass on wealth tax-free.
    \n\u26a0\u00a0Further IHT reforms expected<\/strong>\u00a0\u2013 Speculation grows ahead of the\u00a0autumn Budget<\/strong>.<\/p>\n

    Broader Tax Squeeze<\/strong><\/h2>\n

    \ud83d\udccc\u00a0Income tax & NI receipts up \u00a36.1bn<\/strong>\u00a0\u2013 Frozen thresholds mean\u00a0pay rises push workers into higher tax brackets<\/strong>.
    \n\ud83d\udccc\u00a0Employer NI hikes<\/strong>\u00a0\u2013 Rate increased from\u00a013.8% to 15%<\/strong>, costing businesses\u00a0\u00a38.6bn more annually<\/strong>.<\/p>\n

    The Bottom Line<\/strong><\/h3>\n

    With\u00a0IHT at record highs<\/strong>\u00a0and\u00a0pensions soon included<\/strong>, families must\u00a0plan ahead<\/strong>\u00a0to avoid hefty tax bills.\u00a0Financial advice<\/strong>\u00a0and\u00a0early gifting strategies<\/strong>\u00a0are now crucial.<\/p>\n","protected":false},"excerpt":{"rendered":"

    UK inheritance tax (IHT) receipts\u00a0surged to\u00a0\u00a31.48 billion\u00a0in recent months\u2014a\u00a07% (\u00a398m) increase\u00a0from last year\u2014as\u00a0frozen tax thresholds\u00a0drag more families into paying the …<\/p>\n","protected":false},"author":1,"featured_media":14502,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rank_math_title":"","rank_math_description":"","rank_math_focus_keyword":"","rank_math_keywords":"","footnotes":""},"categories":[17],"tags":[],"class_list":["post-14501","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=\/wp\/v2\/posts\/14501","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=14501"}],"version-history":[{"count":2,"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=\/wp\/v2\/posts\/14501\/revisions"}],"predecessor-version":[{"id":14504,"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=\/wp\/v2\/posts\/14501\/revisions\/14504"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=\/wp\/v2\/media\/14502"}],"wp:attachment":[{"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=14501"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=14501"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=14501"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}