http://www.teletext.co.uk/personalfinance/homes/default.aspxen-gbWed, 9 Dec 2009 14:39:33 GMThttp://www.teletext.co.uk/images/Logo64x64.gifhttp://www.teletext.co.uk
The announcement was made during Mr Darling's Pre-Budget Report speech, with the freeze expected to remain in place until 2011.

The Chancellor, defending his decision, declared that "fewer than 3%" of the population will be hit by the levy.

The threshold at which IHT becomes payable, at a flat rate of 40%, was originally due to rise from its present level of £325,000 for a single person to £350,000 from next year.

Couples can still transfer their allowance to their spouses in the event of their deaths, giving them a combined allowance of £650,000.

IHT is especially relevant to people who are passing on a valuable property.

Mr Darling's decision means heirs of more householders will be liable to pay the 40% tax if property prices rise.

As such the IHT freeze will come as a blow to homeowners with assets worth between £325,000 and £350,000.

Two years ago, in the 2007 Pre-Budget Report, Labour asserted that it would raise the IHT threshold gradually to £350,000 for a single person and to £700,000 for couples, from April 2010.

The announcement came after the Tories promised to raise the IHT threshold to £1m for a single person.

Since then, house prices have fallen and the UK has entered recession.
Source: thisismoney.co.uk

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