The following Trusts and Inheritance Tax guidance note by Tolley provides comprehensive and up to date tax information covering:
Inheritance tax is charged at the rate of 40% on estates at death or at half that rate, 20%, on chargeable lifetime transfers. The NRB is an important relief which assigns a rate of 0% to the lower portion of an estate or transfer.
Inheritance tax only becomes payable if the chargeable transfer exceeds the NRB in force at the time the transfer is made. In order to determine whether a transfer exceeds the NRB, it is added to the transferor’s previous chargeable transfers in the preceding seven years. This is known as the cumulation principle.
See Example 1.
The NRB is currently £325,000. This threshold has applied from 6 April 2009 and it is intended to remain at that level until 5 April 2021. Thresholds in previous years are as follows:
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.
Access this article and thousands of others like it free for 7 days with a trial of TolleyGuidance.
Read full article
Already a subscriber? Login
To view our latest tax guidance content, sign in to Tolley® Guidance or register for a free trial.