The Budget in March contained measures that could have serious implications for anyone who wants to limit their inheritance tax liabilities. People who have already taken measures – such as giving away assets to their children – could also be caught by the legislation.

The Chancellor, Gordon Brown, wants to attack existing and future schemes where people give away their home in a tax efficient manner but continue to live in the property. From April 2005, anyone who has done this since March 1986, could be hit with an annual income tax bill based on the rent they should be paying.

However, the Government has said the measures should not affect “legitimate transactions between family members”.

Cases where a change in circumstances has lead to someone moving back into the home should also be exempt from the new rules, according to the Government.

If you are in any doubt, however, it could be time to take some expert legal advice.