"Given that IHT has been left unreformed for decades, the Government should respond by making the seven-year rule more generous, reducing it to just four years. This would help those who are old or unwell pass on wealth without fear of an IHT penalty. Currently, any gift over the £325,000 IHT threshold made more than seven years before death is exempt from IHT. A tapered IHT relief is applied to gifts where an individual dies between three and seven years after making the gift. Adopting a four-year rule and scrapping the tapered relief could simplify the IHT regime considerably while maintaining an attractive exemption."
