More than half of Britons have no idea what inheritance tax is or what steps they can take to limit the amount they pay, a survey showed today.
About 58% of people claimed not to know about the tax, rising to 61% among women, according to insurer Friends Provident.
Inheritance tax (IHT) is charged at 40% on assets worth more than £300,000 that a person leaves behind when they die.
Unsurprisingly, given their ignorance of the tax, 85% of people did not know that Chancellor Alistair Darling announced last year that couples would have a shared threshold of £600,000 before the tax kicked.
Around 40% of people expect to leave behind an inheritance worth up to £300,000 when they die, while 18% think they will leave behind more than this.
Among those who have thought about inheritance tax, 15% said they plan to seek professional advice, 14% said they will make a will, and the same proportion said they would rather spend their money before they die.
Director of marketing at Friends Provident, James Ward, said: ‘IHT isn’t something that is at the forefront of most people’s minds. In fact, as our research shows, a significant percentage of the population doesn’t even understand what the term stands for.
‘But given the rise in house prices and earnings in recent years, many people have been pushed over the IHT threshold, perhaps without even realising it, so it is definitely something worth thinking about and planning for.’
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