IHT confusion leads to financial problems

Britons risk financial problems by making bad inheritance tax (IHT) decisions, which will this year see the taxman rake in nearly £2bn that could otherwise be used to pay off personal debt.

According to Unbiased.co.uk, the vast majority (86 per cent) of Britons aren't doing anything to help reduce their tax burden, risking financial problems in the process.

However, the website has pinpointed what people can do to help with finances.

For exampe If the proceeds of life assurance policies are left in trust, rather than as part of the deceased's estate, they will not be subject to IHT.

More people could find themselves hit by IHT over the next four years, as the threshold is frozen at £325,000 and will not rise in line with inflation.

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