IHT a target

Analyst: IHT is an ‘obvious target’ for tax raidWith Chancellor Rishi Sunak reportedly mulling tax reforms as he looks to balance the books post-pandemic, AJ Bell analyst Tom Selby believes inheritance tax is an "obvious target". He says the Government could look at the levy as the next Budget approaches, saying: “Certainly the amount of people's estate that is subject to inheritance tax has been reduced over the last few years, it has become more generous.” This, he suggests, has been a “vote winner” but argues that with the country facing “severe fiscal problems”, allowing people to inherit more tax free “might be a bit too generous”. Mr Selby says that while officials may look to “tighten” inheritance tax, he suspects people will try to “move around their assets in a way that avoids the tax in the first place." Considering how the Chancellor may reform IHT, he suggests that the threshold may be changed rather than there being an increase in the rate paid.