Title page
Contents
Summary 5
1. How does Inheritance Tax work? 7
1.1. Information and advice 7
1.2. What is included in someone's net estate? 7
1.3. The treatment of 'gifts' 8
1.4. The treatment of the home 11
1.5. Other major reliefs 11
1.6. Transferring the nil-rate band 12
1.7. Reduced rate and charity donations 13
2. Who pays inheritance tax? 14
2.1. How many people pay inheritance tax, and how much do they pay? 14
2.2. The composition of chargeable estates 15
2.3. Inheritance tax and avoidance 15
2.4. Additional data 17
3. The administration of inheritance tax 18
3.1. Who deals with the estate? 18
3.2. The process 18
3.3. After the estate's value is estimated 19
3.4. Paying the tax 19
3.5. Identified issues with the administration of inheritance tax 20
4. Recent inheritance tax policy decisions 22
4.1. Brief history 22
4.2. Inheritance tax, 2001 to 2021 22
4.3. Timeline of policy decisions 23
5. The case for abolishing inheritance tax 30
5.1. A singularly unpopular tax 30
5.2. Reasons for abolition 32
6. Options for reform 35
6.1. Inheritance tax not achieving redistributive objectives 35
6.2. Taxing the recipient instead of the estate 36
6.3. Reforming individual elements of the tax 38
6.4. Reforming the reliefs 41
6.5. Inheritance tax and capital gains tax 46
7. International comparison 48