Inheritance Tax Planning (IHT) 

Those estates valued over £285,000 are liable to IHT at 40% for the amount over the £285,000 limit.  This limit is reviewed each year by the Government and traditionally it has risen each year.  

While there is no tax liability between spouses, the value of house prices in today’s climate is resulting in more and more clients finding they are leaving an IHT problem for their beneficiaries (normally their children).

There are a number of ways, through advance planning, this bill can be reduced and money set aside outside of the estate to pay for the tax bill. 

There are three main avenues through which IHT can be dealt with and prepared for: 

1)     Expertise Will Planning – we are members of the Society for Will Writers.

2)     Placing Investments in Trust – this can immediately take money out of the estate.

3)     Whole of Life policies – placed in trust and paying on second death where applicable. 

The use of Trusts may not be common to all clients but can simply be explained as follows: It gives you control of your money in life and in death.  

Without the use of a Will and Trust arrangements, the individual loses all control over how their estate is divided and will take a far greater timescale to process. 

The FSA does not regulate Will Planning and some forms of Inheritance Tax Planning.