The Labour Party has published a report entitled “Land for the Many” – see attached link
In the report, there is both good news and bad news
One of its principal recommendations is that inheritance tax should be abolished, and replaced with a lifetime gifts tax levied on the recipient. One the face of it, “this is good news” say Chris Cummings Head of Tax at ASE Global.
Unfortunately, in order to levy tax on the recipient the report sets out proposals to have a lifetime allowance (£125,000) after which gifts are taxed progressively up to 50%. The net effect, “an increase in IHT from annual yields of £5.3bn to £15Bn is not good news” highlights Chris.
More importantly, Chris noted “the report to be thin on detail in relation to the continuation of IHT exemptions for businesses being handed from one generation to another. This is most unwelcome”.
A large proportion of motor dealers are family businesses. If these proposals were to be introduced by a Labour government, taxpayers would be “kicking themselves” if they had not accelerated the process of transfers of wealth / succession ahead of any change.
As Chris concluded, “we live in very uncertain political times, but even today life, death and taxes as opposed to Brexit, Referendums and General Elections, remain the three certainties which all taxpayers will have to deal with sooner or later”.
In case of any questions please contact at Chris.Cummings@ase-global.com
Tel: +44 (0)161 493 1930