12 March 1999

Inheritance boost

The nil rate band for inheritance tax will increase in line with inflation to £231,000, a rise of £8000.

Potentially exempt transfers, business and agricultural property relief stay the same.

However, new provisions apply to block a loophole on gifts of land after Mar 9, 1999. An arrangement had allowed the donor to occupy the land to a "significant degree" without paying a full rent and the gift is made within seven years.

This is intended to block schemes such as the Lady Ingram case which recently succeeded in the House of Lords.