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Taxation: Inheritance Tax

Volume 713: debated on Tuesday 20 October 2009

Questions

Asked by

To ask Her Majesty's Government what is their most recent estimate of the costs of increasing the inheritance tax threshold to £1 million for each of the next five years. [HL5484]

To ask Her Majesty's Government what is their most recent estimate of the number of tax-paying estates that would benefit from an increase in the inheritance tax threshold to £1 million; and how much those estates would save, broken down by value of estate. [HL5485]

The cost of increasing the inheritance tax threshold to £1 million with effect from April 2010 is estimated at £500 million in 2010-11, £1.2 billion in 2011-12, £1.4 billion in 2012-13 and £1.5 billion in 2013-14. Forecasts beyond 2013-14 have not been made.

The latest estimates of numbers of estates for deaths in 2010-11, which would be taxpaying under the current regime, and the amount of tax that would no longer be payable under the increased threshold, are shown in the table below.

Number of estates benefiting from £1 million threshold by estate size (year of death 2010-11)

Estate size

Number of estates

Total tax no longer payable (£ billion)

£0-0.5 million

3,000

0.1

£0.5-1 million

5,000

0 5

Over £1 million

3,000

0.7