The recent Autumn Statement has not brought any changes to inheritance tax, contrary to many expectations.
This decision has been perceived by some as a strategic move in the run-up to next year’s elections, possibly hinting at future changes that could benefit wealthier individuals in the Spring.
Surge in Inheritance Tax Receipts
A notable increase in inheritance tax receipts was observed, with a 12% rise from last year.
The figures reached £4.6 billion in the first seven months of the 2023/24 Financial Year. This was higher than the previous year’s total of £4.1 billion for the same period.
This trend suggests a potential record-high collection by the end of this year, which will have a significant impact on the UK’s economy.
Impact on Estate Planning
The ongoing uncertainty around inheritance tax has unsurprisingly influenced countless estate planning decisions.
Many individuals have expressed reluctance to make long-term commitments, as seen in various discussions among practitioners on social media platforms.
Pension Reforms and Implications
The UK government has declared a significant increase in the state pension by 8.5%, which means that starting in April 2024, pensioners will receive £221.20 weekly.
Alongside this, the government is considering a major reform: the creation of a ‘lifelong pension pot’.
This idea involves merging an individual’s pension savings into a single account, regardless of their job changes. This proposed change aims to simplify pension management for savers and enhance their financial outcomes.
Key Goals of the Pension Reform Package
The planned pension reforms are designed to revamp the entire pension system.
The key objectives of these reforms are:
- Improving Pension Outcomes: Ensuring pension savers get the most benefit from their investments.
- Strengthening the Gilt Market: The goal is to create a more stable and varied market for government bonds (gilts), which are critical for pension funds.
- Boosting the UK’s Financial Standing: These reforms are intended to solidify the UK’s reputation as a leading global financial centre.
These initiatives are part of the Chancellor’s broader efforts to reform the UK’s financial markets, making it an attractive destination for business and investment.
Comprehensive Legal Support
At St Helens Law, we recognise the intricacies and challenges that come with understanding and adapting to the latest inheritance tax and pension reform regulations.
Our dedicated team of legal experts is committed to keeping up to date with every shift in legislation and policy.
This commitment enables us to offer you the most current and strategic advice, ensuring that your financial and legal decisions are both informed and effective.
Our experienced wills and probate solicitors specialise in creating customised estate plans that align with your unique circumstances and goals.
We offer a range of services, including drafting wills, preparing powers of attorney, and advising on tax-efficient ways to pass your assets to your heirs.
Get in touch
For advice and information on the topics mentioned in this blog discuss this with an accountant or IFA. If you require one, we would be happy to refer. We do not provide financial advice, only legal advice.