Topics include - Discretionary Will
Trusts, Will Trusts, IHT Planning, Wills, Inheritance Tax, UK,
Avoidance, Avoiding, Death Duties, Estate Planning, Allowance,
Inland Revenue, Gifts, Lifetime, Estate, Reduce, Minimise,
Methods, Society of Will Writers, Solicitors, Financial
Services, Gift and Loan Trusts, Discounted Life Trusts,
Discounted Gift Trusts, Promissory Trusts, IHT Bonds,
How to avoid UK
Inheritance Tax.
UK Inheritance tax can prove to be an
unfair tax on British Citizens - this
can be minimised through sensible and
straightforward advanced planning.
UK Inheritance Tax (IHT) is the tax 'your estate' pays when
you die although it can also be charged on certain lifetime
gifts. However, Inheritance tax is not just a concern for the
seriously wealthy. It is a growing worry for many people - but
unlike many other taxes, there are plenty of things you can do
now to make sure you pass as much of your wealth on to your
family and friends, not the taxman.
Inheritance tax planning requires the
combined use of financial planning resources as well as legal
services to ensure your estate is structured to work with your
chosen tax planning method. For example certain investments
products such as unit trusts are not as tax efficient from an
inheritance tax point of view than investment bonds, however
professional advice from a company such as ours should be sought
on a one to one basis before implementing any planning strategy.
Inheritance tax used to be known as capital transfer tax
and death duty.
Figures* just released last month, show that 2.4
million homeowners have a potential Inheritance Tax
liability of 40%, an increase of 500,000 households in the first
half of 2004 and a 12% increase in house prices has exceeded the
3.1% increase in the IHT nil rate band, the tax free part of
your total estate (Homes, savings,
cars, valuables etc.) that is know as the
'nil rate band' currently just £300,000.
*Source Halifax financial services.
As an examplefor a single person; if your home is worth £250,000, your savings
are £75,000 and life assurances not in trust say another
£100,000. This combined with the rest of your valuables at
£70,000 totals to £495,000. Most of us a worth a lot more dead
than we might think! The tax payable on an
estate worth £495,000.00 is an amazing £92,800.00. The truth is
millions of people are paying tax unnecessarily as they have
failed to put in place some simple advanced planning.....
Today, fairly modest estates can be hit by UK Inheritance
Tax. In the 2004-2005 tax year, only estates worth less than the
£300,000 threshold will escape Inheritance tax . This might seem
a lot of money, but really it's little more than the cost of an
average home in the many property hot spots.
For UK Citizens, If your estate is over £300,000, therefore,
subject to certain other exemptions and reliefs it bears UK
Inheritance Tax at 40% on the excess. This allowance is per
person in a marriage or civil partnership.
So unless you plan carefully then it is possible that your
estate too will be hit by UK Inheritance tax. It may seem very
unfair that even after death, we are still pursued by the
taxman. But plan now and you could cut the amount of UK
inheritance tax your estate has to pay - meaning there will be
more to pass on to your family and friends.
UK Inheritance Tax is an unfair tax in our opinion, it is the
beneficiaries who have to pay, and many beneficiaries are NOT
wealthy, UK Inheritance Tax seems to miss it's target.
Hopefully we can answer many of your questions:
- What is UK Inheritance Tax?
- What are the main exemptions and reliefs?
- When is UK Inheritance Tax Paid?
- What is my estate made up of?
Careful planning can reduce - or even eliminate - a potential
UK Inheritance Tax bill. Some things you can do yourself: others
require professional help.
The use of trusts can be very important in mitigating
liability to Inheritance Tax
Just a bit of planning can pay huge dividends when it comes
to Inheritance Tax. You may not want to think about your death,
but it is better to face it now and start planning, so your
hard-earned assets pass to your loved ones, not the taxman.
This can be a complex area. Quite apart from this, use of
professional advisers can not only simplify matters, but help
ensure that your planning is performed properly and without
error. To assist we have identified sources for a range of
Inheritance Tax services... from will writing packs, to trust
fund administrators. UK Inheritance Tax Planning (Estate
duty or capital transfer tax) can be reduced or eliminated
through early financial planning methods.
If you need any assistance, guidance or further information
on these services,
please do not hesitate to
contact us.
