London property boom spells Inheritance Tax windfall for HMRC
Anyone lucky enough to own property in London is probably facing an Inheritance Tax liability. And the way things are going it is only going to get worse.
Last week we got the news that average house prices in London had gone up 6% over the course of a year. According to the Evening Standard that means that an average price in London is £375,795, which is £50,000 over the current tax-free threshold.
But this doesn’t tell the whole story. Look at the current prices rises across the boroughs:
Hammersmith & Fulham 11%
These are all above the London average.Today, if you want to buy a small flat in Kensington & Chelsea you can expect to pay £1.1 million. Westminster? £800k minimum.
Friends of ours recently put their small 2 bedroom flat in Clapham on the market and were shocked to have it valued at £750,000.
It seems crazy, but according to many experts these soaring prices are only to go in one direction.
Mervin King and Alistair Darling have both come out and said that the Government’s new Help to Buy scheme will only fuel London house prices further.
And with George Osbourne freezing the Inheritance Tax threshold until at least 2019 – it’s pretty obvious that he’s quietly banking on an Inheritance Tax windfall over the rest of the decade to help him balance the books.
The fact is, in the current climate, anyone who owns property in London must have it properly protected with careful estate planning.
To not do it is akin to opening up your wallet and inviting the Chancellor to help himself.