Kingsley Napley unveils ‘Legacy Tax Premier League’ (ITPL)

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Kingsley Napley unveils ‘Legacy Tax Premier League’ (ITPL) OCTOBER 18, 2021

Home Insights News Kingsley Napley unveils the ‘Legacy Tax Premier League’ (ITPL)

An analysis of government inheritance tax data by law firm Kingsley Napley shows the geographic dispersion of estates affected by inheritance tax bills.

Based on the latest available HMRC statistics on Inheritance Tax Receipts (IHTs) (see source), Kingsley Napley can reveal:

Barnet tops the rankings in terms of the volume of domains affected by IHT (Table 1); Kensington and Chelsea lead by the average value of paid IHTs (Table 2); Contrary to popular belief, it’s not just London and the original counties that pay a higher IHT – Stratford-upon-Avon, Winchester, Devon and Dorset are hot spots too; Average IHT bills range from £ 65,000 in Walsall to over £ 1 million in Kensington; Wide range in London, from an average of £ 83,000 in Newham to over £ 1million in Kensington.

The numbers were remarkably consistent with the same analysis for the previous tax year, except:

Chichester, Leeds and St Albans are in the top 20 of the ranking of the volume of domains affected by IHT (Table 1) contrary to the latest figures; South Norfolk, Plymouth and Brentwood are in the top 20 for the average IHT value (Table 2) unlike the most recent table.

Commenting on the analysis, James Ward, Head of Private Clients at Kingsley Napley, said:

It’s not just the wealthiest families that pay the most IHT. As our ranking shows, some families are better than others at estate planning. With recent increases in property and stock prices and increasing taxes elsewhere, the IHT remains an area where something can be done to mitigate potential liability owed. IHT is a Premier League that you don’t want to dominate.

In March of this year, the government announced it was freezing the zero rate bracket of £ 325,000 for inheritance tax and the zero rate bracket of £ 175,000 for residency until April 2026. There is speculation that the Chancellor may seek to tighten up IHT rules in his next October budget, although other areas of the tax spectrum such as CGT reform would bring in more revenue to the Treasury.

Kingsley Napley has seen a growing number of inquiries from people aged 65 and over with growing estates who want to take legitimate steps to reduce their estate tax obligations.

James Ward says there are five main ways to go about it, namely:

Capital donations: large transfers seven years before your death; Surplus Income Donations: Regular contributions towards tuition or a mortgage can also help; Exemptions: Make sure you use all of your zero rate brackets and consider trade relief. Although complex, the latter can lead to big savings. Life insurance: Consider paying this amount to family members. Let the insurance pay the tax. Ski: Spending the children’s inheritance! For example good wine, good food, vacations and outings!

James Ward adds:

Those who live in IHT hotspots should seriously consider all of these steps and more to avoid ranking at the top of our Premier League on inheritance tax in the future. It is always wise to have a regular review of estates and estate plans to ensure tax efficiency in the event of death.

The analysis of the Kingsley Napley Inheritance Tax Premier League is as follows:

1. Classification by number of IHT successions – Taxation years 2018/19 and 2017/18

2018/19 Rank Zone Number Amount £ M Average £ k 1 Barnet 316 92 291.1 2 Wiltshire 261 60 229.9 3 Edinburgh, City of 254 54 212.6 4 Bromley 249 52 208.8 5 Cornwall 245 49 200.0 6 Elmbridge 197 49 248.7 7 Richmond upon Thames 191 47 246.1 8 Wandsworth 176 51 289.8 9 Ealing 173 32 185.0 10 Croydon 169 29 171.6 11 Cheshire East 165 30 181.8 12 Westminster 159 130 817 , 6 13 Kingston upon Thames 159 47 295.6 14 Bristol, City of 159 25 157.2 15 Enfield 159 24 150.9 16 Merton 150 41 273.3 17 Brighton and Hove 149 27 181.2 18 Birmingham 148 31 209, 5 19 Camden 145 64 441.4 20 Kensington and Chelsea 144 154 1,069.4 2017/2018 Rank Zone Number Amount £ M Average £ k 1 Barnet 339 119 351.0 2 Wiltshire 281 61 217.1 3 Bromley 260 40 153, 8 4 Edinburgh City of 258 61 236.4 5 Richmond upon Thames 239 53 221.8 6 Wandsworth 233 57 244.6 7 Cornwall 222 44 198.2 8 Croydon 209 28 134.0 9 Enfield 203 29 142.9 10 Cheshire East 200 45 225.0 11 Birmingham 199 29 145.7 12 Elmbridge 191 53 277.5 13 Ealing 186 35 188.2 14 Brighton and Hove 175 35 200.0 15 Chichester 166 44 265.1 16 Reigate and Banstead 159 40 251.6 17 Camden 158 134 848.1 18 Waverley 157 37 235.7 19 Leeds 153 24 156.9 20 St Albans 153 25,163.4

2. Ranking by average value of IHT estates – Taxation years 2018/19 and 2017/18

2018/19 Rank Zone Number Amount £ M Average £ k 1 Kensington and Chelsea 144 154 1,069.4 2 Westminster 159 130 817.6 3 Camden 145 64 441.4 4 Stratford-on-Avon 79 34 430.4 5 South Oxfordshire 106 39 367.9 6 Babergh 44 16 363.6 7 Winchester 104 37 355.8 8 West Devon 35 12 342.9 9 Hammersmith and Fulham 104 35 336.5 10 Test Valley 52 17 326.9 11 Hertsmere 100 32 320, 0 12 Waverley 139 44 316.5 13 Chichester 109 33 302.8 14 Kingston upon Thames 159 47 295.6 15 West Dorset 95 28 294.7 16 Barnet 316 92 291.1 17 Wandsworth 176 51 289.8 18 South Bucks 107 31 289.7 19 Islington 80 23 287.5 20 Merton 150 41 273.3 2017/18 Rank Zone Number Amount £ M Average £ k 1 Camden 158 134 848.1 2 Kensington and Chelsea 139 110 791.4 3 Westminster 149 68 456.4 4 Amber Valley 33 13 393.9 5 Sevenoaks 117 42 359.0 6 Barnet 339 119 351.0 7 Winchester 112 39 348.2 8 South Norfolk 55 19 345.5 9 Waveney 49 16 326.5 10 Chiltern 129 42 325.6 11 Brentwood 69 22 318.8 12 Harborough 36 11 305.6 13 Plymouth 43 13 302.3 14 Abe rdeenshire 73 22 301.4 15 South Northamptonshire 37 11 297.3 16 Cotswold 85 24 282.4 17 Islington 75 21 280.0 18 Elmbridge 191 53 277.5 19 Tandridge 87 24 275.9 20 West Oxfordshire 73 20 274.0

NOTES TO EDITORS

Kingsley Napley Inheritance Tax Premier League is based on HMRC data from inheritance tax returns published on July 29, 2021 (Source: www.gov.uk/government/statistics) which relate to inheritance tax invoices paid in 2018/19 , and includes comparable figures for the 2017/18 tax year. The numbers of estates subject to tax in the event of death are estimates and the numbers given are by Local Administrative Units (LAU) Level 1.

ABOUT KINGSLEY NAPLEY

Kingsley Napley LLP is a leading UK-based law firm providing expertise for the professional and private lives of our clients, where it matters most. We advise in the following areas: employment law, private client advice, public law, criminal defense litigation, corporate and commercial law, dispute resolution, family law, medical negligence and personal injury, regulation, real estate , construction and immigration.

Kingsley Napley is ranked as the top UK law firm to work for in the 2021 Best Companies to Work for Work list, as cited here.

The firm was ranked 73 in The Lawyer’s list of the top 200 UK law firms in 2020 in terms of turnover.

James ward

Partner and head of department

+44 (0) 20 3535 1653

[email protected]

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