New data released by HM Revenue & Customs (HMRC) has revealed inheritance tax (IHT) receipts are some £700 million higher than this time last year.
Total receipts from April 2022 to December 2022 now sit at £5.3 billion compared to £4.6 billion in December 2021.
Largely driven by soaring property prices in recent times, the value of people’s estates has risen, making rises in HMRC’s IHT take inevitable – especially in the context of the nil-rate band and residential nil-rate band both being frozen.
This also comes amidst reports of HMRC “targeting bereaved families” with “raids” on the estates of wealthy deceased individuals to double-check whether they’re paying the right amount of IHT, with as much as £326 million reportedly coming between March 2021 and March 2022 as a result of such raids.
Commenting on the latest figures was Andrew Tully, technical director at Canada Life, who said it looks as though a “record-breaking year” is on the way:
“The latest IHT receipts suggest we are on a trajectory for a record-breaking year, with the frozen thresholds catching more estates in a wider tax take. Inheritance tax is no longer an issue for the wealthy only, but with effective [..] planning much can be done to minimise the impact of IHT on estates, including the use of trusts and gifting.”