View more on these topics

Pressure mounts on Osborne over ‘unsustainable’ IHT reforms


Treasury committee chairman Andrew Tyrie has called on the Government to remedy “unsustainable” reforms to inheritance tax policy in the March Budget.

The Government unveiled plans to bring in a new IHT allowance of up to £1m for married couples when a family home is included as part of its July Budget, with the plans forming a key part of the Conservative’s election manifesto.

Tyrie first wrote to Chancellor George Osborne to express concerns over the plans in mid-December, calling the changes “a mess of complexity and uncertainty”.

And Tyrie has now responded to draft clauses on the plans, which include tweaks designed to limit disincentives to downsize.

The changes are set to come into effect from April 2017, but Tyrie warns the changes are “impenetrable” for ordinary investors and “traps lie everywhere” in the detail of the policy.

Tyrie adds: “The tax is no longer the exclusive concern of the very wealthy; over the course of a lifetime, more than a million estates will be affected, largely representing strivers who, after decades of hard work, have accumulated enough to pass something on to their relatives.

“The reform has the hallmarks of unsustainability and therefore instability which is the negation of good tax policy. The March Budget will provide another opportunity to remedy these problems. I urge you to take it.”

It comes after Osborne denied the proposals would make the UK’s IHT rules unreasonably complex.

In a letter dated 9 December, Osborne said: “I agree that we should always strive for simplicity in the tax system where possible but I do not believe the inheritance tax system is any more complex than most comparable systems”.


Andrew Tyrie Tory conf 2013.jpg

Tyrie: Osborne’s property IHT reforms ‘a mess’

Treasury committee chairman Andrew Tyrie has branded Chancellor George Osborne’s property inheritance tax reforms “a mess”. Under proposals set out in the Budget, the main residence nil-rate band will increase from £325,000 per person to £500,000. The combined threshold for married couples will rise to £1m for married couples by 2020. However, Tyrie has written […]

Andrew Tyrie Tory conf 2013.jpg

Tyrie re-elected Treasury committee chair

Andrew Tyrie is to remain as chairman of the Treasury select committee after challengers failed to emerge for the role. Tyrie led the committee throughout the last parliament, becoming a high profile critic of the FCA and the Bank of England, as well as the wider financial services sector. In one of the committee’s final […]

The small print on new IHT rules and downsizing

Last year the Government announced measures designed to tackle the growing number of estates drawn into an inheritance tax liability through house price appreciation. The residence nil-rate band will eventually allow up to £175,000 of property wealth per person to be passed on with no IHT liability. Added to the standard nil-rate band of £325,000, […]


Treasury confirms IHT exemption for drawdown

Funds left in drawdown pensions after death will not be subject to inheritance tax, the Government has confirmed. In the Autumn Statement document published today following the Chancellor’s speech, the Treasury committed to legislative changes as part of the Finance Bill 2016. The exemption will be backdated to deaths on or after 6 April 2011. […]


News and expert analysis straight to your inbox

Sign up


There are 2 comments at the moment, we would love to hear your opinion too.

  1. Govt. pension simplification, honesty (ISAs to be increased evey year by inflation, NOT in 2016/17), tax simplicity…… Ha!Ha! Ha! You couldn’t make it up! George is panicking about his 2020 deficit end promise, Prime Minister? Prime financial buffoon!

  2. “A mess of complexity and uncertainty”.
    That sums up Oribble Osborne too a T. Tyrie should have included pensions in this quote.

Leave a comment


Why register with Money Marketing ?

Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

News & analysis delivered directly to your inbox
Register today to receive our range of news alerts including daily and weekly briefings

Money Marketing Events
Be the first to hear about our industry leading conferences, awards, roundtables and more.

Research and insight
Take part in and see the results of Money Marketing's flagship investigations into industry trends.

Have your say
Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

Register now

Having problems?

Contact us on +44 (0)20 7292 3712

Lines are open Monday to Friday 9:00am -5.00pm