The Inheritance Tax ‘burden’

The recent Budget did not contain some of the previously expected Inheritance Tax increases although it seems to have focused quite harshly on the rural community. However, with revenues from Inheritance Tax at £5bn in the last seven months alone, perhaps more measures are on the way to maintain (and boost) such a convenient tax…for the Government.

What can you do about it?

A Will

If you are married, or in a civil partnership, and own a business, there are relatively straightforward Wills to be done to considerably reduce Inheritance Tax on your combined estate. For around £500 for a typical tax planning Will with us, you can potentially save tens of thousands in Inheritance Tax simply by ensuring you have the right Trust in your Will to protect the business interest and not lose your tax exemptions.

Make gifts

There are easy, and further tax reducing, ways to gift your assets away. This might sound like a drastic step but, if you have surplus income building up that you currently simply put in savings or investments, you could routinely transfer these amounts instead to family members and/or a Trust to prevent the value being included in your estate once you pass away. There is usually a seven year rule to consider for gifts that basically requires you to outlive the gift by seven years to keep it out of your estate for Inheritance Tax purposes. Gifts from surplus income however are not affected by this requirement and, in theory, can be unlimited in value.

For Wills and advice on ways to reduce Inheritance Tax, contact one of our Wills and Estate Planning Team who will be pleased to assist – call 01606 74301 or email reception@mosshaselhurst.co.uk