Change to IHT rules 'welcome'

The initiation of a government consultation into the workings of inheritance tax (IHT) reporting requirements has been welcomed by one industry body.

Assurance firm Standard Life has asserted that recent changes to the treatment of gifts and trusts, as detailed in the 2006 Budget, have meant that many consumers have been forced to file a variety of forms reporting gifts even when IHT should not be levied.

New levels of compliance established last year meant that some trusts, previously potentially exempt, became chargeable, moneymarketing.co.uk reports.

However, new regulation under consultation would mean that forms would not have to be filed for transfers under £210,000, provided no other chargeable transfers had been implemented within the last seven years.

Julie Hutchison, Standard Life Assurance estate planning specialist, remarked: "I welcome this open approach to developing the new regulations.

"The proposed retrospective nature of these rules is a positive step since taxpayers who have made gifts to trusts from April 6th 2007 onwards will be able to take advantage of the new rules when they are finalised."

Last month Standard Life urged widows to seek advice in reviewing their legal and financial affairs, ensuring all such matters are clearly understood in one of the "difficult and confusing times a woman can face".