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IHT bill for 40 per cent of households

Up to 50,000 families are expected to pay inheritance tax (IHT) next year, experts predict.

This is up from 18,000 people a year in 1997, representing an increase of more than 300 per cent.

Scottish Widows warns that 40 per cent of households could be liable for IHT. Some 5.3 million have property valued above the £285,000 threshold and a further five million are eligible when savings and other assets are taken into account.

Anne Young, from Scottish Widows, said: "IHT is no longer a rich man's tax, it is a tax that affects more people every day.

"It is important people understand what inheritance tax is, and how families will be affected upon the death of a loved one."

The rising number of people caught by the IHT net is being blamed on escalating house prices, however, chancellor Gordon Brown is reluctant to rise the IHT threshold inline with property inflation.

Ms Young added: "Our research shows that the government raising the threshold by just over three per cent in the last budget has not had any impact on the number of people liable for IHT, in fact the situation has worsened."

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15/01/2007 13:45:54

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