HMRC’s IHT Earnings: £4.3 Billion in Six Months – More Money, More Mysteries
Listen up, folks! HM Revenue & Customs (HMRC) just spilled the beans on how much inheritance tax (IHT) they’ve hauled in from April to September 2024. The number? A whopping £4.3 billion – that’s £400 million more than the same stretch last year. The tax‑jackpot isn’t a fluke; it’s been on a steady rise for the last 20 years.
Tax‑Time Numbers that Pack a Punch
- Recent six‑month haul: £4.3 billion
- Year‑on‑year increase: £400 million
- Last full tax year: £7.499 billion collected
- Only about 1 in 20 estates hit the tax bill now – but that could change in the next Budget.
Why IHT Is a Real Cash Cow for HMRC
According to Nicholas Hyett, Investment Manager at Wealth Club, inheritance tax is the government’s “cash‑cow” – a guaranteed income stream that keeps regulators focused as the Autumn Budget looms. While no one knows every tweak in the pipeline, most agree the aim is to squeeze more revenue from estates.
Possible Tweaks & Their Impact
- Business Relief adjustments – This benefit lets family‑owned businesses pass on smoothly and encourages investors to back rapid‑growth ventures (AIM, EIS, etc.). Taking it away could chill the venture‑capital stew.
- Pensions no longer IHT‑free – That would discourage pension saving across the board, undercutting people’s ability to enjoy a decent retirement.
- Longer gift‑free window – Extending the time before gifts become taxable means fewer estates hit the tax flag.
The Big Picture – Short‑Term Gains, Long‑Term Consequences?
Governments love a quick win – a dash of extra revenue to put on the purse‑strings. However, pulling the plug on these reliefs might dent the very businesses that keep the economy humming. “To tweak IHT is tempting, but it can do long‑run damage,” Hyett warns, urging policymakers to balance immediate priorities with future prosperity.
Wrap‑Up: What’s Next?
With the Budget approaching, watch for headlines on who’s getting the “marmalade” from this tax. Will one more estate face a bigger tax bill? Will small businesses feel the pinch? Stay tuned, keep an eye on the numbers, and remember: IHT isn’t just a legal formality – it’s a living, breathing part of the economic storyline.
