
Dementia currently affects 1 in 14 people in the UK. Many people will either know someone with dementia, have had to support and care for someone with dementia or have been diagnosed themselves.
On 8th July HMRC issued a statement setting out some of the detail about this proposal. The Devil is certainly in the detail!
Even now we will have to await the legislation before some details become completely clear.
A number of points have however become clearer.
The additional nil rate band (ANRB) will only apply when a residence is passed on death to a direct descendant. Direct descendant will be a child (including a stepchild, adopted child or foster child) of the deceased and their lineal descendants.
The property has only to have been the residence of the deceased “at some point” and be included in their Estate. If you own more than one property at your death then your Executors can choose to which property the relief is to apply. The relief can only be offset against one property and not split between a number of properties. No definition of “residence” is yet available but it will no doubt require some degree of permanency or at least the intention of permanency.
The Government proposes that the relief will still be available if the deceased has “downsized” or sold their only residence during their lifetime. Once again how this will operate in practice is unknown.
The relief will only be available from 5th April 2017 and will then be worth £100,000, increasing, in stages, until it is worth £175,000 from 5th April 2020. In the meantime the existing nil rate band (of £325,000) will remain frozen until April 2021.
If however a person downsizes or ceases to own a home on or after 8th July 2015 the ANRB will still be available in respect of deaths after 6th April 2017.
The relief will be transferable between spouses and civil partners – presumably in the same way as the existing transferable nil rate allowance. A claim to the transferable allowance will have to be made in the usual way.
The relief is further restricted in the following ways:-
Conclusion
The relief is certainly not as simple as was suggested in the initial announcement.
There is a significant amount of detail which is still unclear. It is not clear whether the relief will apply to properties, or a share in a property, that is owned by a trust but, because of the way in which Inheritance Tax works, we believe this may be the case.
Given the various restrictions the relief will be of limited benefit.
If you or your parent(s) have sold a property it will be sensible at this time to ensure you keep a copy of the statement giving details of the sale price etc as well as copies of Council Tax and other utility bills where possible and other mail as evidence of occupation. This should help in any future claim for the relief.
The Tory Party first talked of introducing a £1,000,000 nil rate allowance in 2008. It will be over 12 years before they fulfil that “promise” and even then it will be subject to many restrictions.
Contact Alex Elphinston, Donna Holmes or James Hall.
Dementia currently affects 1 in 14 people in the UK. Many people will either know someone with dementia, have had to support and care for someone with dementia or have been diagnosed themselves.
The 2022 Code replaces the NHF Code of Conduct 2012 (the 2012 Code) and sets out the baseline standards that the NHF expects of its member registered providers (RPs).
The High Court has dismissed a challenge by the Police Superintendents’ Association to the closure of legacy public sector pension schemes.
In my recent blog, I said that we would be issuing a series of ebriefings and blogs highlighting issues with the Procurement Bill. This is the first of these.
Contractors and delivery partners are facing a ‘perfect storm’ in many cases with a number of factors directly impacting upon the profitability of their work.
Worker status, like Piers Morgan, is one of those things that we think has gone away and then it pops up again!
We are seeing a steady trickle of decisions focused around the issue of flexible working requests or employer requirements for changes to working patterns (both pre and post the pandemic).
For those of us who have endured a choppy cross channel journey, the mention of P&O Ferries will invoke some nauseous memories.
Successive generations have witnessed seismic shifts in the workplace; post-war it was the return of the soldiers and the impact on working women who had to work in their place.
In this podcast, Puja Desai interviews Kimberley Foster and discusses her experience with counselling. This is a really helpful podcast for anyone who has thought about counselling.