Built -In Resilience Provides ”The Force” For North East Recovery
April 6, 2021
Rules coming into effect from 1 January 2022 will mean that nine in 10 estates that are not subject to Inheritance Tax (IHT) will no longer need to complete IHT forms as part of the probate process.
Meanwhile, a temporary measure that is currently in place so that IHT returns can be submitted with a physical signature will become a permanent change.
John Bunker, Chair of the Chartered Institute of Taxation’s Private Client (UK) Technical Committee, said: “We welcome that, as part of the implementation of the OTS recommendations ‘to improve the customer journey’ for IHT many families in the aftermath of bereavement will be spared the additional stress of supplying unnecessary detail to HMRC.
“The change will mean that only around 15 per cent of estates will need to complete some form of IHT return.
“The challenge for HM Revenue & Customs (HMRC) will be to design a process that meets that aim and is fit for purpose in only nine months.”
At the same time, HMRC has issued guidance for the first time on what it considers to constitute a spouse or civil partner for the purpose of IHT.
This expressly states that cohabiting partners, not in a marriage or civil partnership, are not recognised in the IHT rules.
However, perhaps surprisingly, people in polygamous marriages recognised in the UK – including those entered into such arrangements overseas in jurisdictions where they are permitted – are recognised for the purposes of IHT.
March 25, 2021