What you need to know about Inheritance Tax changes from 6th April 2012
As of today's budget changes, Inheritance Tax matters have largely stayed the same:
- There are no changes to the current Inheritance Tax threshold, known as the 'nil rate band' (NRB). The NRB is currently £325,000 and is now set to remain at this figure until 2014-15 tax year.
- Inheritance tax is payable at 40% on all assets above the NRB. Spouses and civil partners still benefit from the transferable NRB which means that on the death of the first spouse/partner the survivor can benefit from an increased NRB of up to £650,000.
However, there has been one change, with the introduction of a new lower rate of Inheritance Tax comes into effect on 6th April 2012; where a person leaves 10% of their net estate to charity they will benefit from a reduced tax rate of 36% on all assets that exceed the NRB. This is great news for charities and is heralded as a much needed boost to charitable giving, which has seen a huge decline in the recent economic downturn.
For more information please contact Jenny Pierce.