Inheritance tax is a tax paid by an individual or family who inherits something from a deceased person. The heirs pay it after the death of the particular person who gave them their property or property.
It is often misunderstood that inheritance taxes and property taxes are the same. However, this is not the case because the inheritance tax is not levied on the entire inheritance; it is only paid on inherited property. However, in some countries, such as the UK, the two do not differ much. Inheritance tax is also known as death debt.
UK inheritance tax includes property, jewelry, collectibles, and even intangible assets such as investments and life insurance. In the UK, this tax is levied on the inheritance of £325,000 or more. In the event of death, the bereaved family is directly subject to inheritance tax because they become the owners of the property. The dying person can also state the beneficiary in his will, who is then responsible.
In some cases, a person is exempt from paying inheritance tax. If a British citizen has lived abroad for more than three years within the twenty-year tax period, he or she is not liable to pay this tax. In addition, if the asset is located overseas, it is not taxed.
If a person gives property to someone at least seven years before his death, the property is not taxed. Likewise, the transfer of property or assets to a spouse or children is tax-free. In addition, there is no inheritance tax on child life insurance.