Budget 2011: IHT bills cut for those leaving 10% or more to charity

From next April, the IHT rate will be cut to 36% for those leaving part of their estate to charity, as part of the government's plan to galvanise a charitable Britain.

George Osborne commented in today's Budget that this "major change" is to make "giving 10% of your legacy to charity the new norm in our country".

This tax change will mean charities benefit from an extra £300 million each year.

In addition, from next April IHT will be indexed against the consumer prices index measure of inflation, although the current £325,000 nil-rate IHT band is frozen until April 2015.

Jonathan Gain, chief executive of Stellar Asset Management, comments that the change is a "feel-good measure".

He adds: "There's potential for it to be very attractive, and I think people will give it greater consideration. It will change everybody's outlook."

However, he did mention that this year's Budget is "fairly quiet" from an IHT point of view.

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