Careful planning is essential to ensure you don’t pay a significant proportion of your wealth to HM Revenue & Customs on your death.
Under current legislation, the first £325,000 of an individual's estate is not liable to inheritance tax (‘IHT’). For married couples and registered civil partners it is currently £650,000, if the full allowance is passed to the surviving spouse. Anything in excess of this amount is taxed at 40% on death.
If your estate exceeds this amount, and you do nothing, your executors might have to pay a significant proportion of your estate to HM Revenue & Customs.
We can help you to mitigate the impact of IHT on your estate using a combination of one or more of the following:
- Ensuring that your Will is drafted correctly to save the maximum amount of tax using trusts.
- Transfer assets through the use of lifetime gifts
- Create a tax-efficient fund to enable the beneficiaries of an estate to meet the tax liability without disturbing the family wealth. Under current IHT legislation, pensions can play a considerable role in estate planning.
- Utilising investments which qualify for relief from IHT
Although pension death benefits are broadly exempt from IHT, if they are passed to your survivor they will form part of their estate. We can offer solutions which allow your survivor access to your death benefits without them forming part of their estate.
Our service, provided in conjunction leading law firms, is designed to provide a wide range of different options to deal with these problems.
* The information on this website is based on our interpretation of the law and HMRC practice as at April 2016. Taxation legislation and HMRC practice may be subject to unforeseen changes in the future.