Inheritance Tax

Inheritance Tax Thresholds

Year	Amount (£)
2010-11	325,000
2009-10	325,000

 

The IHT threshold is to be frozen at £325,000 until 2014/15.

For deaths after 9th October 2007, a transfer of any unused nil rate band is available from former deceased spouses and civil partners.

Amounts above the threshold are taxed at 40%.

Most transfers between spouses and civil partners are exempt.

Chargeable lifetime transfers are initially charged at 20%.

Business Property Relief

• Business, interest in business or qualifying shareholders in unquoted companies (includes AIM listed companies) - 100%
• Land, buildings, machinery, or plant used in a company controlled by the transferor - 50%
• Agricultural property - 50% or 100%

Other Reliefs:

• Annual gifts of up to £3000 per donor are exempt.
• Small gifts £250
• Marriage gifts...
  • parent £5,000
  • grandparent £2,500
  • bride/groom £2,500
  • other £1,000

Reduced charge on gifts made within seven years of death:

Years before death	0-3	3-4	4-5	5-6	6-7
% of death charge	100	80	60	40	20