21 August 2009
IHT 'still payable' without a will
People will still need to pay inheritance tax (IHT), even if they do not have a will, a writer for the Telegraph has reminded consumers.
The newspaper's personal finance correspondent, Myra Butterworth, said it is important people are aware of the change to the rate of interest charged on IHT payments made after the six-month deadline.
She noted that from next month, the interest rate is set to increase to 2.5 per cent above the current bank rate, bringing the current rate to three per cent for those who fail to pay the tax within six months after the end of the month in which the deceased person died.
It is estimated that the change could affect up to 12,000 estates across the UK, as HMRC anticipates this number is set to pay IHT before the end of the 2010 tax year.
And it is important to remember that IHT is still payable, even if a person dies being inestate - having made no legal will.
Research conducted earlier this year by Norwich Union indicated that many people are leaving estate planning too late - some 40 per cent of people between the ages of 50 and 64 claim they will wait until they are "a little older".
However, most advisers recommend that people begin planning their estates at the same time they plan their retirement, usually between the ages of 55 and 65.