HM Treasury’s United Kingdom Budget 2007

Grant Thornton

Grant Thornton

Inheritance Tax

Cumulative transfers

After 5 April 2007 From 6 April 2005 – 5 April 2007 Rate
£ £ %
1-300,000 1-285,000 nil
over 300,000 over 285,000 40

Transfers within seven years of death

Years % of charge at death
0-3 100
3-4 80
4-5 60
5-6 40
6-7 20

Chargeable lifetime transfers

50% of death rate

Main exemptions and reliefs

  £
Annual gifts per donor1 3,000
Small gifts per donee per annum 250
Gifts in consideration of marriage/civil partnership
  • parent
5,000
  • grandparent or other direct lineal ancestor
2,500
  • between the parties to the marriage
2,500
  • other
1,000
Transfers between spouses/civil partners exempt2
Normal expenditure out of income exempt3
Gifts to charities, political parties, for national purposes exempt3
Business property relief 50% or 100%3
Agricultural property relief 50% or 100%3

Business property relief 50% or 100%2
Agricultural property relief 50% or 100%2

1 May be carried forward 1 tax year and used only after subsequent year exemption applied
2 Restricted to £55,000 where the transferor but not the transferee is domiciled in the UK.
3 Detailed conditions apply

The figures shown here are subject to ammendment as the Finance Bill passes through Parliament.

This information has been prepared only as a topical guide to tax and personal financial matters. No responsibility can be accepted by us for loss occasioned to any person acting or refraining from acting as a result of any material contained in this publication.

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