Those of us with an interest in tax, or a concern for the impact of tax on our estate, will remember a report published by the OTS a few years ago on suggested changes to Inheritance Tax (IHT). I will not repeat the terms of that report here, but suffice to say that it contains changes that would rewrite parts of the current IHT landscape, particularly for farmers and others who rely on Agricultural Property Relief (APR) to reduce or eliminate their IHT liability.
The OFS report was only a recommendation and has not been acted upon by the government. Nevertheless is has been a cause for concern as a possible indicator of the future of IHT and APR.
In the Autumn statement of 17 November 2022, the Chancellor announced that the OTS would be abolished. It will be replaced with a mandate to the Treasury and HMRC to focus on simplifying the tax code.
We will see whether this change of direction actually results in any simplification of the tax code, but in our view the changes suggested in the report are now less likely to be implemented.
If you would like to discuss IHT planning, or any other tax matter, please speak to a member of our tax team, details of which are below or email Partner Giles Scott, Head of Private Client on firstname.lastname@example.org