Estate Planning

Inheritance is, broadly speaking; a voluntary levy paid by those who distrust their heirs more than they dislike the Inland Revenue. - Lord Jenkins

With careful planning this tax can sometimes be avoided by and in some cases reduced at minimal cost. Without effective planning, inheritance tax of 40% is paid on the value of assets upon death that are above £312,000 (2008/09).

As an example: Most married couples leave everything to each other in their Wills, with the result that more tax is paid than is necessary. Many people are unaware that the threshold before paying IHT (currently £312,000) applies to both individuals. By using each relief a tax saving of £120,000 (40% of £312,000) can be made.

However, since 9 Oct 2007, a surviving spouse or registered civil partner may now claim the unused portion of a deceased spouse’s or civil partner’s nil rate band up to the current nil rate band.