Hunt’s Half-Baked Inheritance Tax Plans

Jeremy Hunt’s plans to cut inheritance tax in the Autumn Statement have been branded as ‘half-baked’ by the property industry, reports Abode2. The Chancellor is expected to use the Autumn Statement to slash what is often described as the most hated of all taxes, as he comes under increasing pressure from Conservative MPs to deliver tax cuts for voters ahead of the general election and make a point of distinction with Labour.

Hunt’s reported move to cut inheritance tax by 10% has been deemed weak, with many industry insiders stating the tax should be abolished altogether.  IHT is often dubbed the most loathed of all taxation, as frozen tax thresholds and an incredibly high rate of 40% place more and more ordinary families at risk of being taxed.

The number of homes facing the IHT burden has more than doubled since 2010, despite it being designed as a tax for only the super wealthy, and around 40% of homes sold in England and Wales in 2022 were worth more than the basic allowance.

“IHT is clearly no longer limited to the ultra-wealthy, as initially intended. It's increasingly affecting middle-class families whose primary asset is their family home," remarks Nigel Green of deVere Group.

The desire to leave a legacy for loved ones is a deeply ingrained human instinct, and individuals find the IHT particularly objectionable as it essentially constitutes double taxation—taxation on assets that have already been paid for and taxed before.

A recent survey conducted by deVere Group, revealed that 72% of individuals aged 50 and above with taxable assets were unaware that the IHT threshold stood at £325,000.

Adds Green: “It’s disconcerting that those with assets susceptible to IHT lack understanding about the potential implications. This lack of awareness puts individuals' families at risk of facing an unexpected and potentially significant tax burden upon the death of a loved one. It's even more troubling given the strong sentiments people have against inheritance tax, detesting the notion of their already taxed money being subjected to further taxation.”

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