The government will collect £37bn in inheritance tax (IHT) over the next five years, according to new official projections.
This figure would represent a 36% increase on the last five years, when £27.2bn was collected.
Due to both rising house prices and inflation, the amount of IHT that the Office for Budget Responsibility (OBR) has predicted will be collected over the next five years has increased by £2.5bn.
Five years ago, IHT had raised an annual amount of £4.8bn for the government. According to the latest OBR projections, however, in five years’ time the estimated figure will be £8.3bn.
NFU Mutual chartered financial planner, Sean McCann, commented: “Rocketing house prices and inflationary increases on the value of other assets means the amount of IHT paid by UK families over the next five years is expected to be almost £10bn higher than the previous five.
“The Chancellor’s decision to freeze the tax-free allowances for IHT until 2026 means more families will be caught in the inheritance tax net in the coming years.”
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