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UK citizens face inheritance tax (IHT) rates that are more than double the European Union’s average, according to a report from an international accountancy network.
The research, produced by UHY International, analysed the IHT liability of someone leaving an estate of £2.4m in a range of nations around the world. In the UK such a person would hand over, on average, in excess of £560,000 in IHT; almost 24 per cent of the estate’s value. Individuals in the rest of the EU would pay on average just over 10 per cent on a similar estate.
According to UHY people in emerging markets would pay on average just 0.9% on the sum while those in several countries, including Australia, New Zealand, Portugal and the USA would pay no IHT at all on such an estate.
The UK does not, however, lead the field in IHT liabilities. The survey points out the Japanese would pay 29.5 per cent on the £2.4m estate, while Belgians and French would be charged at 26.9 and 25.3 per cent respectively.
Mark Giddens, partner at UHY Hacker Young, told the Money Observer website: “IHT in the UK can be very complicated, and anyone with a sizeable estate will need professional guidance to navigate it. Simplifying it would be a very popular move for the government to make.”
In the UK, the IHT threshold has been static at £325,000 since 2009, contributing in large part to IHT receipts reaching record levels.