Tax Rates

Tax RatesTax Rates

Inheritance Tax IHT Rates and Allowances:  2009/2010 and 2010/2011 - Threshold Frozen

Payable on transfer of assets whether transfer is made in life or death

* With effect 8 October 2007 on the 'second' death, i.e. the death of a surviving spouse or civil partner whose partner has already passed, any additional % of the nil rate tax band unused on the 1st partner's death can be carried forward to second death. For example, a husband and wife who do not use their Nil rate band allowance on first death will have two allowances on second death

Who pays UK Inheritance Tax?

Rates of Tax - Rates of Tax on Chargeable Lifetime Transfers: Gifts/transfers you make when alive.  Value of Estate and tax rate

  • £0 - £325,000 - 0% tax rate
  • Excess over £325,000 - 20% tax rate due at time of gift or transfer
  • The value of the estate includes cumulative gifts and transfers made in last 7 years allowing for taper relief.

Rate of Tax on Potentially Exempt Transfers (PETs)

  • At time of gift or transfer - no tax is due as the transfer is potentially exempt
  • Death within 7 years - Normal death rates may apply subject to taper relief rules
  • Death after 7 years - Completely free of Inheritance Tax

Rates of Tax on Transfer on Death: Value of Estate and tax rate

  • £0 - £325,000 - 0% tax rate
  • Excess over £325,000 - 40% tax rate
  • The value of the estate includes cumulative gifts and transfer made in last 7 years allowing for taper relief.
Request expert inheritance tax advice today.


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