Homeowners were warned not to neglect inheritance tax planning in the wake of reports that the Tories would raise the tax threshold to £2m.

David Searle, a tax partner at accountant Baker Tilly, said he feared that many couples would not now bother planning what would happen to their estates on their deaths, assuming that they would not be liable for the 40pc tax.

'That would be unwise,' he said. 'Obviously this plan would take a lot of households out of the inheritance tax net, but the devil is in the detail, and we do not yet know what restrictions there will be.'

Shadow chancellor George Osborne revealed plans to raise the inheritance tax threshold for married couples to £2m after a pledge by Alistair Darling, the Chancellor, to raise the threshold to £700,000.

Daily Telegraph