2011 Budget Information
2011 Budget
The 2011 Budget made great steps towards making legacy giving
easier and better for all involved. Below you will find some
information on what was said and what developments can be expected
over the next year.
Inheritance Tax – Reduced Rate
The Chancellor announced that a new rate of tax of 36% will
apply in cases where 10% or more of the deceased’s net estate is
left to charity. ‘Net estate’ for this purpose will be the value of
the estate after deducting all IHT exemptions, reliefs and the nil
rate band. The Government will be consulting on the details for
implementing the plan and intends to issue a consultation paper
before Summer 2011.
Inheritance Tax – The Allowance
The Nil Rate Band will continue to be frozen until April 2015.
From the tax year 2015/16, the consumer prices index (CPI) will be
used as the default indexation assumption instead of the Retail
Prices Index although Parliament will continue to be able to
override this and set a different figure.
Gifts of Art
The Government is considering introducing legislation to provide
a tax reduction for donors to the State of historical objects or
works of art which are of national importance. A consultation paper
will be published during Summer 2011.
Withdrawal of SA Donate Scheme
The Self Assessment (SA) Donate scheme, whereby individuals opt
for tax repayments to be donated to charity, is to be withdrawn
from 6 April 2011 and this includes the withdrawal of the scheme in
relation to claims for repayment made from that date which relate
to previous tax years.
The reason being given for the withdrawal of the scheme is that
it was rarely taken up, was not cost effective and was open to
fraud. The Government proposes to redirect its resources to the
proposed online Gift Aid claims system.
We will be keeping an eye out for developments and the papers
published this Summer. Check back for more information then.