Don’t forget the Marriage Allowance
The Marriage Allowance allows you to transfer £1,190 of your Personal Allowance to your husband, wife or civil partner, which can reduce their tax by up to £238 every tax year (6 April to 5 April the following year).
To be eligible to benefit as a couple, you need to earn less than your partner and have an income of £11,850 or less. Your partner’s income must be between £11,851 and £46,350 (£43,430 in Scotland).
You can backdate your claim to include any tax year since 5 April 2015 for which you were eligible for the Marriage Allowance. You can still claim even if your partner has sadly died since then.
To start the process simply follow this link: https://www.gov.uk/apply-marriage-allowance.
Inheritance Tax could be simpler in the future
A long overdue announcement by The Chancellor that a review of the UK’s Inheritance Tax (IHT) rules in the Autumn of this year has been made.
IHT was first introduced in 1986 and, since then, has been subject to many modifications to keep up with changes in society and economics. More and more people are becoming liable for IHT charges because of the increases in property prices over recent years and the government are certainly benefiting from this.
This review will highlight areas of administration and technical tax standpoints with a view to recommending how these can be simplified, including things such as:
- IHT returns and how the tax is paid
- gifting rules (annual gifts, small gifts and normal expenditure gifts)
- the probate procedure
We will have put in place some form of IHT planning for almost all of you so you will know how complex this area of estate planning can be, therefore any simplification will be welcomed by us all. If you have also had to go through the probate procedure you will know how complex this can be at such a difficult time.
We are also interested in any simplification regarding gifting, as this will hopefully prompt a review of the gifting allowances and lead to some potential increases. These allowances have not been raised in quite some time and so would benefit from an increase to match the changes that have occurred in the economy.
We will update you again when we see the outputs from the review.