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Tax Rates and Allowances 2020
- IHT may be payable when an individual's estate is worth more than the IHT nil rate band when they die.
- Lifetime and death transfers between UK domiciled spouses are exempt from IHT.
- For 2021/22, a further nil rate band of £175,000 may be available in relation to current or former residences.
- The IHT threshold available on death may be increased for surviving spouses as there may have been a nil rate band not used, or not fully used, on the previous death.
- There are reliefs for some business and farming assets which reduce their value for IHT purposes.
- IHT may also be payable on gifts made in an individual's lifetime but within seven years of death.
- Some lifetime gifts are exempt.
- Transfers of assets into trust made in an individual's lifetime may be subject to an immediate charge but at lifetime rates.
- There are also charges on some trusts.
IHT rates and nil rate band 2021/22 and 2020/21
|IHT nil rate||£325,000|
|Death rate if sufficient charitable legacies made||36%|
IHT reliefs for lifetime gifts
IHT - reduced charge on gifts within seven years of death
|Years before death||% of death charge|