The number of homeowners hit by inheritance tax (IHT) is set to double over the next four years, and experts warn ignoring the problem could be an expensive mistake.
With house prices rising, many will now be liable for thousands of pounds in IHT, even if they have never previously earned enough to pay higher-rate tax. IHT is set at a fixed rate of 40 per cent on assets at death which exceed £325,000. In the last budget the IHT threshold was frozen until 2018, despite house prices rising at an average rate of 3.4 per cent a year.
Experts at Ludlow Wealth Management Group, which has offices in Preston, warn families will be caught out if they do not consider an alternative approach. David Hardman, director at Ludlow said: “Effective estate planning is becoming more important to decide how to leave assets to those who matter most to you in the most effective way.”