Treasury drops plan for a single nil-rate band settlement
The Chancellor had stated an intention to impose a single nil-rate band across all trusts, with a view to saving inheritance tax. However, the Treasury has now changed its mind and has withdrawn these proposals.
The proposals received a lot of criticism. The target was a clampdown on pilot trusts, which are a means of reducing the inheritance tax charges on funds held in trust in certain situations. However, the draft proposals would have had significant implications for many, including those with life and pension policies.
This is good news as it will mean less complication and less uncertainty, despite the Treasury’s announcement that it will continue to review the inheritance tax rules on trusts.
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