Institute for Fiscal Studies has suggested restricting relief from inheritance tax (IHT) to raise revenues and make the tax ‘fairer’. 😒
The IFS suggests targeting:
- business property relief (BPR) on AIM-listed shares
- capping or outright abolition of agricultural and business asset reliefs
- ending the tax-free inheritance of pension pots to bring pensions within the IHT net
Imagine the impact to your business if existing IHT reliefs for owners of small UK businesses! How will the beneficiaries pay IHT? Sell the business assets and stop operating the company? This will have a major impact on the UK economy. This will increase the urgency for inheritance planning and potentially force family businesses to consider succession earlier and perhaps pass shares down to the next generation too soon in order to mitigate tax risks leading to other risks for the next generation as I often highlight.
Bringing pension will mean disincentive pension savings when the state is trying to encourage people to save for their retirement, so we don’t have an increasingly ageing population relying on the state
