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Inheritance Tax Planning

There are numerous ways to mitigate Inheritance Tax Planning (IHT), but we find that the majority of cases utilise a combination of the following:

There is much to be discussed, but the main issues of IHT planning fall in to 5 main headings…

Access – can you get to the money again if you need it.
Speed – how quickly can the plan be effective to shelter from IHT.
Simple – Is the solution easy to understand and straight forward in terms of structure.
Control – Can you still control how and whether the money is spent following the transaction.
Cost – How much is the plan going to cost over your lifetime.

Traffic light comparison

AccessSpeedSimpleControlCost
Gifting
Whole of Life
Loan Trust
Discounted Gift Trust
Flexible Reversionary Trust
Business Property Relief
How each of the solutions fare in relation to these issues is indicated above using a traffic light system; green being the most favourable.

Please note: this graphic is subjective to change, not every expert will agree on the distribution of colours. There is much more to know before you act and that you should always seek financial advice first.

Inheritance tax becomes due when you die…

If you have an estate, your assets will become taxable, and the amount owed will be calculated based on the value of your non-exempt assets. Inheritance tax planning is a legal process which enables you to protect and shield your assets to lower bills in the event of your death.

You may assume that it’s relatively easy to shelter your assets by gifting them to loved ones, but this is not always the case. When you think about your assets, and gifting them to others, several questions arise.

You may not know which of your assets you’ll need? How long you’ll need them for? And nobody knows what the future holds?

“In this world, nothing can be said to be certain, except death and taxes” Benjamin Franklin

“I’d like somebody to get rid of the death tax…. If I give something to my kid, I already paid the tax. Why should I have to pay it again” Whoopi Goldberg

Business Property Relief Schemes invest in assets that are high risk and can be difficult to sell such as shares in unlisted companies. The value of the investment can fall as well as rise and investors may not get back what they originally invested, even taking into account the tax benefits.

IHT Planning is best dealt with holistically, taking into account all of your finances and goals

We have many years of experience in advising clients across the country who wish to use legal processes to protect their estate, and we provide a tailored service for each individual. Our company is well qualified to answer questions and enable you to organise your assets.

If you have any questions or queries call us on: 0800 093 4115

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