In what seemed to be a surprise move, Rishi Sunak called a snap summer election which is now little more than 3 weeks away.
Attention will turn next week to the party manifestos which will begin to give us an idea of what the main parties have in store for us in the coming 5 years. A Labour victory looks all but certain at this stage, although as the saying often goes, a week is a long time in politics and so I suppose 4 weeks is an eternity! Things can of course change, however for the moment, let’s consider the likely outcome that we have a changing of the guard at Westminster in 4 weeks’ time.
Labour have said relatively little about their plans for Inheritance Tax in recent months. In fact, the last real policy direction we have from them came in the wake of the 2017 introduction of the Residence Nil Rate Band (the £175,000 allowance on the family home) where they said that they would reverse the move if they were elected.
That was almost 7 years ago now during a time when the party was under the leadership of Jemery Corbyn. As such, I don’t think we can read a lot into it.
One thing that seems reasonably certain is that Inheritance Tax is unlikely to get any better under a Labour Government. It could certainly get worse, but in my view the most likely outcome is that they leave it as it is, at least for the time being, while they deal with more pressing priorities.
The risk here is that the election gives yet another reason for people to delay taking action – this is rarely an effective strategy, especially given that some options may not exist after the election.
Where estate planning is concerned, it is important to just begin and not be distracted by things over which we have no control – elections chief among them.
We will of course keep a close eye on political developments in the coming weeks and any likely impact on estate planning strategies.
