Inheritance Tax is one of the few taxes you can still shape while you're here to do it.
Inheritance Tax is charged on the value of an estate above certain thresholds, at rates of up to 40%. With careful, properly structured planning, many families are able to reduce what falls due, or in some cases remove it altogether, through entirely legitimate means.
Understanding what's owed, and what's avoidable.
Every estate has a tax-free allowance, known as the nil-rate band, currently set at £325,000. A further residence nil-rate band of up to £175,000 may also be available where a home is passed to children or grandchildren, bringing the combined allowance to as much as £500,000 for an individual, or £1,000,000 for a married couple or civil partnership using both allowances together.
Inheritance Tax planning is the process of understanding how these allowances apply to your particular estate, identifying any reliefs you may be entitled to, and making decisions in good time that keep more of what you've built within your family.
Left unplanned, the tax bill falls where it lands.
Without a plan, the value of an estate above the available thresholds is simply taxed at the standard rate of 40%. Gifts made in the years before death can also be brought back into the estate under HMRC's seven-year rule, sometimes catching families by surprise at the worst possible time. Reliefs that could have reduced the bill, on a family business or agricultural land, for example, can go unclaimed simply because no one knew to look for them.
None of this tends to surface until the estate is being wound up, by which point the options for reducing it are far more limited than they once were.
A clear plan for what can be done, and what can't.
A full review of your estate against the current thresholds and reliefs available to you.
Guidance on gifting, trusts and other structures that may reduce what falls due, explained in plain terms.
Support coordinating your Inheritance Tax planning with your Will, LPA and any existing Trusts, so nothing works against anything else.
Ongoing review as your estate, your family, and the rules themselves change over time.
Talk to us about your Inheritance Tax position.
A confidential conversation about your estate, the thresholds that apply to it, and the planning that could reduce what's due — with no obligation.
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