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AS 2012: Inheritance tax threshold set to increase

The inheritance tax threshold is set to increase by 1 per cent from £325,000 to £329,000 in 2015/16.

Budget group shot 2012 480

In the 2010 emergency Budget, the Government froze the nil band for inheritance tax for four years. It will be the first increase under this Government but remains lower than the current rate of inflation.

The Conservative party manifesto pledged to increase the allowance to £1m but it was dropped as part of the coalition agreement.

In its 2007 pre-Budget report, Labour changed the IHT rules to allow couples to combine their allowances.

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