The introduction of any changes to inheritance tax has been ruled out by the UK government.

This includes rules around agricultural property relief, which allows most farming families to be exempt from inheritance tax at the time of a death.

In July 2019, the Office for Tax Simplification (OTS) produced a report for the UK government on recommendations to reform inheritance tax.

Responding to the report on Wednesday, Treasury Minister Lucy Frazer said that the government has “decided not to proceed with any changes at the moment”.

Significant reforms to capital gains tax were also ruled out by Frazer. It follows the OTS recommending that the capital gains uplift, a mechanism used for calculating capital gains tax bills, should be scrapped.

Adopting this recommendation would have led to significantly higher tax bills for many landowners who sell inherited property (see www.ifj.ie/ots).

Trade-offs

“These reforms would involve a number of wider policy trade-offs and so careful thought must be given to the impact that they would have on taxpayers, as well as any additional administrative burden on HMRC,” Frazer said.