Latest HMRC data reveals that IHT receipts for the period April 2021 to February 2022 now stand at £5.5bn; £0.7bn higher than the same period last year.
In its latest report HMRC has also explained that it expected higher IHT receipts from March to August 2021 due to “higher volumes of wealth transfers that took place during the Covid-19 pandemic”, however more data will be required before this can be confirmed.
Commenting on historic data, HMRC revealed that receipts in April 2017 to May 2017 and March 2019 to April 2019 were particularly high, due to announcements (and subsequent delays and cancellations) of rises to probate fees in England and Wales in February 2017 and November 2018, which is likely to have caused executors to bring forward tax payments to avoid the prospective higher fees.
Lower receipts in April and May 2020, HMRC said, were due to a temporary issue where HMRC were unable to accept cheques for payment of IHT due to Covid-19, which was resolved, hence the peak in June 2020 receipts.
The average amount paid per estate was £209,000, according to calculations made by the company Quilter.
Andrew Tully, technical director at Canada Life, commented to Professional Adviser:
“This will be welcome news for chancellor Sunak … IHT continues to prove its worth to HMRC making it unlikely that the prolonged freezing of the thresholds will be defrosted in the near future.”