The Chancellor has outlined a promise he says he could not fulfil in coalition. From April 2017, parents can pass £1m on to their children free of inheritance tax. A “family home allowance” worth £175,000 per person will be added to the existing £325,000 tax free allowance from April 6, 2017.
This means that individuals can pass on assets worth up to £500,000, including a home, without paying any Inheritance tax at all. The full benefit of the relief, however, will not be felt until the tax year 2020/21, owing to the fact that there will be a phasing in period of the additional relief from 2017/18.
George Osborne said: “The wish to pass something onto your children is the most basic, human and natural aspiration there is”.
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