Inheritance Tax (IHT) can be a costly expense for an Estate to bear. It can also be a complex process for Executors to deal with, post death, when feelings are raw and emotions high. Of course, the calculation and payment of IHT cannot always be avoided but steps can be taken to try and minimise the amount of IHT due or, in some cases, eradicate it altogether.
The IHT rate is 40%. It is payable on all Estate assets, to include cash, investments, possessions (to include jewellery, artefacts, vehicles) and property.
For many people the most valuable asset that they own is their home. There are ways in which steps can be taken, during lifetime, to try and limit the impact of inheritance tax, particularly by careful thought in relation to how the home is dealt with in a Will.
The IHT thresholds are not straightforward but, very basically, they start at £325,000 for a single person and can be increased, if certain conditions apply, by £150,000; or for a married couple, if Wills are prepared in a certain way, the thresholds can start at £650,000 and be further increased by £350,000, again if certain conditions are met. It is certainly something that we, at Martyn Prowel Solicitors, can discuss with you in detail and advise accordingly.
Faced with the prospect of a large IHT bill after death, some people may think that gifting assets during lifetime might “save the day”. This might be the case but it could actually create a “double whammy”. By this we mean that Capital Gains tax might become payable at the time of the gift and, in certain situations, IHT might still become payable upon death.
Careful consideration and tax planning needs to be taken into account and we can certainly assist you in these deliberations. We are able to offer a one-off meeting, if this is preferable, for a fixed charge of £200 plus VAT or, if you care to contact the office and confirm the concerns that you have, we can provide you with a bespoke quote for the advice required. This can also include an estimate of charges for the preparation of, for instance, a Will or any other documentation that it is felt should be put in place to assist with the advice required.
Please contact Natalie Harvey at the office, to discuss this matter further on (029) 2047 0909.