Inheritance Tax Changes – how do they affect you?

News from the Conservatives that they are following through on their pre-election pledge to raise the inheritance tax threshold to £1 million has been welcomed by families. However, the new rules are not as straightforward as they first appear.

Currently every person has an inheritance tax threshold of £325,000. Any assets above this amount are taxed at forty percent. The threshold can be transferred between married couples and civil partners giving them a combined threshold of £650,000. This threshold remains frozen at £325,000 per person until the end of the financial year 2020/21.

From April 2017, a Family Home Allowance of £100,000 will be added to the threshold and will increase each year to reach £175,000 in 2020/21. Again, the Family Home Allowance can be transferred between married couples and civil partners giving the Conservatives their figure of £1 million.

To qualify for the Family Home Allowance, the property in question must have been occupied by the deceased as their main home at some point and it must be left to direct descendants such as children, stepchildren and grandchildren.

Therefore if you wanted to leave your property to, for example nieces and nephews, you will not qualify for the Family Home Allowance. There has already been controversy with couples who have no children saying the policy discriminates against them. Similarly, clients who do not own a property when they die, perhaps because they have gone into a nursing home, will not qualify for the Family Home Allowance.

At Bretherton Law we can advise you on inheritance tax planning. The earlier you seek advice, the more you and your family will benefit. We make a complex area of law and financial planning simple and use plain English to make certain you understand any decisions made.

Arrange an appointment with Anne Stockley, Head of our Private Client team on 01727 869293 and begin planning for your family’s future today.

Don't miss a post:

Subscribe to our quarterly newsletter
Like us on LinkedIn
Follow us on Twitter
Like us on Facebook

Contact Us

When you send an enquiry you are giving your consent to receive marketing emails from Bretherton Law. We promise we won't bombard you with SPAM emails, or sell your information to someone else and you can unsubscribe at any time.

Do you consent to receive marketing information from Bretherton Law?


Serving Communities In

St Albans, Harpenden, Hatfield, Watford,
Welwyn Garden City, Radlett, Luton

Please contact us with any questions – We are here to help

If you telephone us your call will be answered by a real person (no recorded voice saying press this and that) and our friendly receptionist will listen to your needs and transfer you to the person who can help.

If you email us we aim to respond as quickly as possible but always within one working day.


Contact Us Now

Bretherton Law is the trading name of Bretherton Law Ltd. Company registration number 07795500. Authorised and regulated by the Solicitors Regulation Authority. SRA Number 612461. Accredited members of the Law Society for child law and conveyancing. Members of Resolution.

© 2018 Bretherton Law

Terms & Conditions | Privacy Policy | Cookie Policy