BR report 2018
11 IHT STATISTICS RISING IHT LIABILITIES MEAN OPPORTUNITIES FOR BR In 2016-17 inheritance tax (IHT) receipts were £4.84bn – 4% greater than the previous year and the highest level since the current system was introduced in 1986. 1 Philip Hammond’s 2017 Autumn budget revealed that IHT receipts will continue to grow in the coming years. 2 HM Treasury predicts it will raise £5.3bn in 2017/18, which will eventually increase to £6.5bn by 2022/23. The recent year-on-year rises in receipts reflect the upward trend in value of assets such as residential property, and some securities, since the recession. The nil rate band has also been frozen at £325,000 since April 2009. Although there was a 4% increase in IHT receipts compared to 2015/16, this is substantially lower than the 22% growth from 2014/15 to 2015/16. 3 The increased annual growth from 2014/15 to 2015/16 reflected an uncommonly high number of deaths in the months leading up to 2015/16. The ONS estimated that over the winter of 2014/15, there were 43,900 excess winter deaths, compared to 2015/16 when excess winter deaths were in line with average trends at 24,300. 4 That said, for more than 30 years, the number of people dying in the UK had been falling. However, this trend changed in 2011. Since then, deaths in the UK have risen: there were 50,000 more deaths in 2015 than in 2011, and more than 40,000 more deaths in 2016 than in 2011. 5 The ONS also projected, in its October 2017 National Population Projections, that while 2016 saw 597,206 deaths registered in the UK in 2016 6 , this number is set to rise as the population increases. Although there is 2016/17 data available for total IHT receipts, more granular data for HMRC’s latest IHT statistics is only available for 2014/15. HMRC recorded a total IHT liability of £4.2m for the 2014/15 tax year, a 25% increase on the previous year. MARKET UPDATE INHERITANCE TAX RECEIPTS (2001-2017) SOURCE: HMRC 2001-02 2009-10 2005-06 2013-14 2002-03 2010-11 2006-07 2014-15 2003-04 2011-12 2007-08 2015-16 2004-05 2012-13 2008-09 2016-17 6,000 5,000 4,000 3,000 2,000 1,000 0 TOTAL RECEIPTS (MILLIONS) 605,000 619,000 652,000 693,000 729,000 2017 - 2022 2022 - 2027 2027 - 2032 2032 - 2037 2037 - 2041 UK DEATHS
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