At the time of your death, all of your remaining assets become known as your estate. Your estate can be passed on to your spouse or civil partner without inheritance tax (IHT) implications. But if your assets are left to other family members, such as children, or anyone else, inheritance tax is payable if the value of the assets exceeds the government’s specified threshold.
There are dozens of options available for effectively reducing the size of your taxable estate, in order to minimise the impact of inheritance tax planning. Gifting can not only reduce or eliminate an IHT bill, but provide younger generations with a crucial head start.
Here at, we specialise highlighting the fair, workable and extremely effective opportunities our clients may have to reduce inheritance tax planning liability.
Current Inheritance Thresholds and Taxation
The current inheritance tax threshold stands at £325,000 per person, meaning that for a couple, the value of the combined estate must total £650,000 in order for inheritance tax planning to apply.
Over the coming years, the government plans to gradually increase this tax-free allowance to £500,000, resulting in a combined estate tax-free allowance for couples of £1 million.
When the value of an estate exceeds the threshold at the time, all additional assets are usually taxed at a rate of 40%.
The Value of Inheritance
With so many options available for reducing taxable estate size, it’s important to seek the independent financial advice at the earliest possible juncture. From charitable contributions to trust funds to lifetime gifts and more, Haven IFA will help guide you through the various possibilities in order to pinpoint the most effective.
Advance planning is imperative, as it can take several years for some measures to fully come into effect. With the right advice and a proactive attitude, the potential savings can be enormous.
For more information on inheritance tax planning and related services, get in touch with the Haven IFA team today on 0161 495 9340.