On 19 January 2018, the government requested that the Office of Tax Simplification (“OTS“) carry out a review of inheritance tax in order to identify simplification opportunities. The scoping document for the review was published on 15 February 2018 and the call for evidence on 27 April 2018.
The review largely focusses on the administrative processes through which taxpayers interact with HM Revenue & Customs in relation to inheritance tax with the aim of improving inheritance tax filing and payment procedures. However, there is also scope for comments on the various inheritance tax reliefs including “business property relief” as well as the “residence nil-rate band” which was introduced in April 2017 to provide taxpayers with a potential additional £175,000 allowance for the family home.
Wedlake Bell’s Private Client Team have responded to the call for evidence on behalf of their clients to put forward some areas of possible reform and simplification. These include extending the time in which executors have to pay inheritance tax on a deceased person’s estate to twelve months from the date of death, instead of the current six months which can produce problems in some cases. The response also covers some of the existing inheritance tax reliefs and allowances, including the “residence nil-rate band” which has proved unpopular due to its complexity and limited scope.
Wedlake Bell’s response to the call for evidence can be viewed here.
The OTS expect to publish their report in the Autumn of 2018. Wedlake Bell will be closely monitoring developments for their affected private clients.