“Inheritance tax is viewed as one of the most unpopular taxes around. This is because it is a form of double taxation. A taxpayer saves all their life, these savings represent savings after tax. The tax payer accumulates a lifetime of wealth which has been collected by hard work only to have it taxed a second time on death.”
- In the US the exemption threshold has been increased by Trump to $10 million.
- With inflation this exemption has risen to $12.92m
- This compares with £325,000 in the UK.
- The annual allowance in America is $17,000 a recipient. Gifts larger than this will erode the $12.92m exemption.
- 0.08% Share of estates that attracted an inheritance tax charge in 2019 in the US.
- 3.7% Share of estates that attracted an inheritance tax charge in 2019 in Britain.
- Doubling the exemption has, predictably, almost halved the number of estates paying the tax. Data from the Internal Revenue Service (IRS), responsible for collecting taxes in America, show that the number paying inheritance tax each year dropped from about 5,000 to 2,500 after the exemption was cut.
- Compare this with Britain, where 27,000 families were hit by the charge in 2021, a number that is expected to soar to 47,000 a year in 2028.