Inheritance tax receipts for the present tax yr to-date have reached a document £5.3bn, in response to the newest figures printed by HMRC.
The determine was £700m increased than the identical interval a yr earlier.
The upper determine – which covers April to December 2022 – suggests IHT receipts this yr are on monitor to hit a brand new document this tax yr, topping final yr’s £6.1bn.
For the ultimate quarter of the calendar yr, the IHT take hit £1.8bn – the best complete on document and up from £1.4bn in 2021.
Stephen Lowe, group communications director at retirement specialist Simply Group, stated: “The Treasury seems to be set to gather a document amount of money from inheritance tax this monetary yr and forecasts predict practically £8bn a yr shall be raised from the levy by 2027/28.”
Why are IHT receipts anticipated to rise so rapidly? Primarily as a result of in his Autumn Assertion in November, Chancellor Jeremy Hunt opted to freeze the IHT threshold of £325,00 for an extra two years, to 2027/28.
Andrew Aldridge, companion at Deepbridge Capital, stated: “Given the Chancellor’s freezing of IHT thresholds for an extra two years and inflation remaining excessive, we anticipate that HMRC receipts will proceed to rise within the close to time period.”
Alex Davies, chief govt and founding father of Wealth Membership, stated: “Rampant inflation and years of frozen allowances and hovering home costs imply many extra households will discover themselves hit with a hefty inheritance tax invoice.”
Shaun Moore, tax and Monetary Planning skilled at Quilter, stated the freeze on IHT thresholds to 2027/28 might truly web the federal government greater than £1bn. He stated: “Runaway home costs and stagnant thresholds imply extra individuals are dying with property wealth over the assorted inheritance tax allowances.”
However he added that the brand new figures additionally shone a light-weight on why the federal government prolonged the freeze to earnings tax thresholds as much as 2027/28. Receipts from earnings tax and NI funds from April to December 2022 reached £281.1bn – a rise of £34.3bn in comparison with the identical interval a yr earlier.
Mr Moore stated: “This upward development is more likely to proceed as wage development rises in gentle of inflation, however earnings tax thresholds keep static.”
1,000,000 extra individuals shall be paying increased price tax by 2027, in response to forecasts printed by HMRC.