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Falling house prices leads to jump in inheritance tax refunds

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  • 20/11/2019
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Falling house prices leads to jump in inheritance tax refunds
The number of people reclaiming inheritance tax due to falling house prices has more than doubled over the last two years, new data has revealed.

 

The figures have been published following a Freedom of Information request from NFU Mutual.

It found that for each year between April 2010 and April 2017, between 2,000 and 3,000 people were repaid inheritance tax they had already handed to HM Revenue & Customs as a property included in the estate of the deceased was eventually sold for less than it had been valued at.

However, this rose to more than 4,000 in 2017/18, and again to more than 4,500 in 2018/19. So far in the current tax year more than 2,000 people have successfully reclaimed inheritance tax after selling a property for less than the estimated value.

NFU Mutual said this rise in reclaiming payments had coincided with a “slump in house prices” particularly in London and the south.

Sean McCann, chartered financial planner at NFU Mutual, said plenty of families have paid more inheritance tax than they need to.

He continued: “When property prices and share values fall, rebates are not given automatically and need to be proactively claimed. 

“Those that opt for do-it-yourself probate are not always aware that inheritance tax can be reclaimed in this way. With such a dramatic fall in house prices in some areas of the country, families should take advice to ensure they don’t miss out on any potential rebates.”

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