In April 2017 the inheritance tax laws are changing again, and even the HMRC admits it adds an extra layer making it even more complicated.
They are introducing a new Residence Nil Rate Band, which is an extension to the current inheritance tax law. It will be incrementally phased in over the next 4 years, but by 2020/21 a person owning a property who passes away may be able to claim an additional £175,000 to their current inheritance tax threshold of £325,000… Potentially saving their loved ones a lot of money!
However, it’s not a straightforward add-on to the tax threshold, there are complex rules surrounding if you or the property will qualify.
For example the following may be disqualified:
- Properties being left to extended family members or trusts
- Properties sold to go into a nursing home
- Buy to Let or multiple residential properties
- Estates with a value over £2M
If you have any questions about what inheritance tax band your estate will fall into and how that may affect your loved ones, our Wills & Probate Team are on hand and happy to help answer your questions. Send us a message by clicking here or ring us on 01623 468 468.