Key Considerations about Inheritance Tax

Jun 30, 2017 | Trusts & Tax Planning


Inheritance tax payments are often seen as unfair. You could have worked all your life and acquired a healthy sum only to find that up to 40% of your estate is going to the taxman. At the same time, other options may allow your family members to spend your money in on things you may consider frivolous.

If you are on the verge of estate planning it is a good idea to ensure you are well armed with all the issues and facts before making a decision. Appointing a good financial planner will give you insights into wealth management and estate planning that you never had before.

With this in mind, let’s take a look at some key information about inheritance tax:

  • The current UK threshold of inheritance tax is £325,000. For every £1 above this figure, tax is charged at 40%.
  • Inheritance tax is charged on your estate and not your cash savings. So property values are included. If you live in London or the South East and own your own home, inheritance tax will come into play.
  • You can put your assets for the most part into some form of trust. This can protect your assets from inheritance tax to some degree. As you can imagine trust complexities are often far reaching and requires careful decision making.

Often, inheritance tax decisions are emotive driven. For example:

  • Would you be happy to give your children or grandchildren money without a say in what they spend it on?
  • Do you want to pay rent to live in the house you bought and paid for?
  • Are you worried about possible long-term care requirements you might need in the future?
  • Are you unsure how much money you’ll need to live in comfort for the rest of your life?
  • How do you feel about making cash gifts to children/grandchildren to reduce the value of your estate?
  • Would you prefer to leave your estate to your family when you die?

All of these questions are asked by everyone. Proper financial planning can help you make these decisions and get the big picture on your estate value and what kind of life you can expect to have in retirement.

Click here and complete the CALL BACK SERVICE form in the first instance. Together we can reduce your inheritance tax liabilities.

Source: Tilney

For more information, please contact Michele Carby at Holborn Asset Management on +971 50 618 6463 and on e-mail at [email protected]


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