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27/04/2005
Voters opposed to inheritance tax policy
Almost eight out of ten people believe the inheritance tax threshold is “grossly unfair”, research by financial service group Friends Provident has found.
The rise in house prices over the last decade has seen millions more people becoming affected by the inheritance tax. Chancellor Gordon Brown recently raised the level for inheritance tax from £263,000 to £275,000, but Friends Provident found 67% of those questioned believed that tax on inherited wealth should be set at a higher level.
The online survey of over 2,000 people, conducted by YouGov, found that over those questioned believed that inheritance tax on first homes should be abolished altogether. Sixty-four per cent of those surveyed believed that they should be allowed to pass on the total value of their main abode to a beneficiary without paying tax.
Inheritance tax is currently paid at a flat rate of 40% above the threshold, irrespective of how much wealth a person has. However, the Friends Provident survey found that 76% of people believed that the current inheritance tax system should be reformed, preferring a banded system similar to income tax.
The Chancellor’s recent rise in the threshold has been met with support from some quarters, with 19% of people saying that he believed that the recent budget level was set correctly, while 17% thought that the inheritance tax was fair.
However, only 9% of those surveyed sought professional financial advice in order to minimise their family’s liability to pay inheritance tax in the event of their death.
Ian Jefferies, head of investment marketing at Friends Provident, said: “The majority of families will now find themselves drawn into the inheritance tax net because of the housing boom in recent years. That is why inheritance tax planning should be a key consideration for those families who until recently were not liable for this tax.”
(KMcA)
The rise in house prices over the last decade has seen millions more people becoming affected by the inheritance tax. Chancellor Gordon Brown recently raised the level for inheritance tax from £263,000 to £275,000, but Friends Provident found 67% of those questioned believed that tax on inherited wealth should be set at a higher level.
The online survey of over 2,000 people, conducted by YouGov, found that over those questioned believed that inheritance tax on first homes should be abolished altogether. Sixty-four per cent of those surveyed believed that they should be allowed to pass on the total value of their main abode to a beneficiary without paying tax.
Inheritance tax is currently paid at a flat rate of 40% above the threshold, irrespective of how much wealth a person has. However, the Friends Provident survey found that 76% of people believed that the current inheritance tax system should be reformed, preferring a banded system similar to income tax.
The Chancellor’s recent rise in the threshold has been met with support from some quarters, with 19% of people saying that he believed that the recent budget level was set correctly, while 17% thought that the inheritance tax was fair.
However, only 9% of those surveyed sought professional financial advice in order to minimise their family’s liability to pay inheritance tax in the event of their death.
Ian Jefferies, head of investment marketing at Friends Provident, said: “The majority of families will now find themselves drawn into the inheritance tax net because of the housing boom in recent years. That is why inheritance tax planning should be a key consideration for those families who until recently were not liable for this tax.”
(KMcA)
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