For and against Inheritance Tax
There is both an argument for and against inheritance tax. Does it create a fairer society or does it punish you for doing the right thing trying to provide for your family?
For Inheritance Tax
Wealth in the UK is more unequally spread than income. The UK’s richest 1000 families have more wealth than the poorest 40% of households combined. If inheritances were untaxed there would be no way to redistribute wealth.
Taxing inheritances provides a possible extra source of revenue for public spending and it is levied on those who can afford it most.
The sheer complexity of inheritance tax, with 91 separate IHT reliefs, does however open up a series of avoidance opportunities. The complicated tax system is being taking advantage of more by the super rich in reducing their tax bills.
Against Inheritance Tax
IHT can be thought of as a double taxation. You have already paid tax when you earned your income and you are taxed again on your death. The taxing of an estate could be seen as a disincentive to save, at the same time though the receiving of an inheritance may be a disincentive to work.
Inheritance Tax is an extremely unpopular tax. You work hard all of your life to provide for yourself and your family and you are then prevented from doing what you want with your money at the end of your life.
Whatever the arguments, if you wish to avoid or eliminate your potential Inheritance Tax liability, please call us for help and advice.