To many people inheritance tax means one thing – more money for the tax man, and less for your family or other beneficiaries. If like most people you’ve worked all your life and own your own home, you’ll find that the threshold is not very high at all. Because of this, over £1 billion is paid in inheritance tax every year that needn’t have been paid.
So what preparations can you make to avoid your family paying over the odds? There are many options for you to consider, all of them legal, and many of them quite simple with the right financial guidance. We can help you choose the right steps and put crucial money-savings plans in place. After all, you’ve earned it.
We’ll guide you through the ‘why’ and the ‘how’
Apart from it being money you’ve earned (and paid tax on already) complicated inheritance can be a strain on your family at what is already a difficult and testing time. For example, selling your house or assets to pay a tax bill is an arduous process your heirs could be spared! With our help you’ll work out what your inheritance tax plan needs to achieve. Whether its simplification or more money to your heirs, we will then lay out our recommendations for you to consider. One thing must be said with emphasis, the earlier you plan the better. Some plans only come into force after a set period of time, so if you leave it too late your options are limited.
Our team has helped hundreds of people leave more to their loved ones. They do this through:
- Gifts – arranging a gift, loan, life assurance or trust is a great way to directly control who benefits from your legacy. Gifts must be made 7 years before the event of your death, so it’s worth planning early.
- Exempt allowance – certain exemptions and allowances apply, so before any else is considered we will examine these for you, and work out which you’re entitled to.
- House ownership – if you choose to gift your house or part of it to another you need to plan early and make sure you seek specialist advice.
- Rural estate planning – when it comes to rural estates, farms for example, the situation can get complicated. Luckily our local specialists have worked in your area for years, so they know the lay of the land.
And we have many more ways, depending on your situation. Our key advice is to plan early, seek specialist advice from experts on inheritance tax laws, and explore all your options in detail – both of these things you’ll get from us.
The real implications of inheritance tax
Forty pence in every pound is a substantial burden to leave to your heirs. The threshold is from £325,000, which sounds a fair amount until you look at what it includes. Your cash in the bank, investments, property (like your home), business assets, vehicles and payouts from life insurance policies all count towards the total.
All things considered, it’s a sizeable chunk of what could otherwise be left to those you love to enjoy.
But it’s not all about money. Bear in mind, your relatives might avoid the subject for fear of seeming grasping. For many people it’s about the principal, rather than the cash itself. And for nearly all of clients who undertake inheritance tax planning, it’s about making things easier for their family, knowing that times will be difficult enough already.
Whatever your own reasons, we have the valuable local experience to make all the difference to your legacy. Contact us to find out how.