Understanding Inheritance Tax
In the UK, when someone dies everything they own, known as their ‘estate’, needs to be assessed to see if it is liable to Inheritance Tax (IHT). IHT is usually payable on any assets that are above the ‘Inheritance Tax nil rate band’, which is currently set at £325,000. Anything over this amount may be subject to a 40% charge, IHT, by HM Revenue & Customs. Having already been taxed on earnings and pensions, many people feel that the prospect of giving up a large share of their hard earned assets on death is unfair.