Inheritence Tax

Minimise Your Inheritance Tax Liability

You work hard all of your life to generate personal wealth… so it should be your choice to pass it on to your next generation.

Making gifts of property held within your estate is probably the most common IHT planning advice you can be given. Most of us will be aware of the seven year rule where the property becomes completely exempt from IHT providing you survive the seven years after making the gift. Is this true though? Have you been advised on the gift with reservation of benefit and pre-owned assets rules?

Property that you cant or don’t want to give away will be included within your estate on death and tax will be due at 40% on the overall value that exceeds an individuals’ nil rate band currently at £325,000. It is possible for the surviving spouse to transfer the proportion of any unused nil rate band from the deceased spouse meaning up to £650,000 is exempt from IHT. This may not be your best option though as property left to the surviving spouse is exempt from IHT. If there are any statutory reliefs available, such as business property relief, it may be more suitable to fully utilise them rather than transferring them to the surviving spouse where they may be subsequently lost.

Assets can be held in trust to protect them e.g. from bankruptcy or to hold them on behalf of nominated beneficiaries. This maybe good practice as it reduces the value of your estate but IHT is usually charged when assets are placed into trust, when they leave the trust and on each 10th anniversary year of the trust.

To protect your assets or to ensure those you care about inherit the wealth you’ve worked so hard to create, call us today on 0845 345 7785 for an initial obligation-free conversation.

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