Posted by Nick Day on 13 Aug 2014

HMRC to Force Accelerated Payment of Inheritance Tax

There has been recent press coverage of HMRC powers being used to force the accelerated payment of inheritance tax (IHT) by people who are still alive in situations where IHT avoidance schemes have been used. It remains to be seen whether this comes to pass, but HMRC has already stated that these proposals would only impact on structures that have been established for the purpose of avoiding tax and that schemes or trusts that are “used legitimately” should not be affected. This cuts to the core of the creation of effective structures and shows that off-the-shelf tax avoidance schemes are increasingly vulnerable.

Recent Press

From recent press coverage you could be forgiven for thinking that tax planning has been outlawed, but while artificial tax avoidance schemes are countered by a wide range of legislation, it is not true that long-term planning is being targeted. Well-designed, bespoke structures that are put in place to invest for sound commercial reasons are still able to benefit from the tax incentives that were put in place specifically to encourage that behaviour.

Qualifying Non-UK Pension Schemes

For example, Qualifying Non-UK Pension Schemes (QNUPS) offer protection from inheritance tax, but used for the purpose of avoiding inheritance tax in isolation from your long term financial needs the QNUPS is likely to be ineffective. However, a QNUPS that is used to build a fund for your retirement, with consideration of your wider financial aims, will still be able to benefit from the inheritance tax relief that HMRC has granted to QNUPS to incentivise retirement planning.

Tax Innovations does not offer contrived off the shelf tax avoidance schemes but designs bespoke structures that are integrated into your long term goals and maximise the tax benefits that are in place to reward sensible constructive planning.

Contact Tax Innovations

If you would like any advice regarding the above article or would simply like to discuss other ways in which we could help you or your business, please contact us on 01962 856 990 or


See also…

Inheritance Tax Relief When Downsizing Your Home

Inheritance Tax: Planning for the Future

Wills and Inheritance Tax

Inheritance Tax on Trusts to Increase

Inheritance Tax for Couples with “Mixed” Domiciles

Inheritance Tax on Holiday Lets

Inheritance Tax and QNUPS

Inheritance Tax Overpayments

Inheritance Tax Wastage

Changes to the Taxation of QNUPS

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