Spring Budget 2024: A round up for legacy and probate practitioners

The Spring Budget was announced on 6 March 2024. Rumours circulating in late 2023 of an overhaul of Inheritance Tax rules (or even complete abolition) seem to be something of a distant memory. We wait to see if such teasers resurface when parties start campaigning ahead of the next general election.

However, the Budget did contain some interesting changes for probate practitioners and legacy officers to take note of.

Inheritance Tax

From 1 April 2024, personal representatives will no longer be required to apply for a loan to cover Inheritance Tax before HMRC will consider a grant on credit application. This will help reduce legal costs where the estate is already light on cash in these circumstances.

Perhaps more newsworthy is the commitment to reforming the tax rules for non-domiciled individuals. The new tax regime will be implemented on 6 April 2025 and whilst the full details have not yet been released, we know that the new rules will be based on residence not domicile. The initial focus will be on tax on foreign income and gains.

Changes to the rules on Inheritance Tax are expected to follow to align with a new residence-based regime but the government have announced that a consultation will be launched to determine what this aspect of the new regime might look like.

Capital Gains Tax

The rate of Capital Gains Tax on the sale of residential properties will be 24% from 6 April 2024, down from 28%.

Process and Regulation

  • A Crypto-Asset Reporting Framework will be introduced in 2026.
  • The government is committing financially to HMRC's ability to tackle unpaid taxes. No details provided on what this translates into.
  • A consultation was launched on the same day as the budget into the regulation of tax advisors entitled 'Raising standards in the tax advice market – strengthening the regulatory framework and improving registration'.

An announcement is expected on 18 April 2024 regarding new tax administration and maintenance measures.

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