£3bn paid in inheritance tax in 2012/13

Inheritance tax cost families and individuals more than £3 billion in 2012/13, according to figures from the Office for National Statistics (ONS).

A recovery in property prices and HMRC's drive to collect the tax has resulted in an annual inheritance tax collection that comes close to the record £3.8 billion collected in 2007/08.

Inheritance tax receipts were around £3.14 billion in the tax year to April 2013, an eight per cent rise compared to the previous year, and larger still than the year-on-year growth recorded between 2010/11 and 2011/12.

The decision to freeze the inheritance tax threshold at £325,000, where it has been since April 2009, has also helped boost the amount collected.

According to ONS data, 259,989 estates went through probate - the process of legally distributing a person's estate after their death - in 2010-11, accounting for nearly half of all deaths. Of these, 15,584 were liable for inheritance tax.

The Office for National Statistics said that "up until 2007/08 receipts had been climbing steadily, reflecting increases in asset prices over this period, specifically property prices and household savings."

Inheritance tax dropped after this period following the introduction of the transferable nil rate band, where any unused nil rate band from the first death within a marriage or civil partnership can be claimed against the estate on the second death.

Please contact us for more information about inheritance tax, or about reducing your inheritance tax liability.