reducing Inheritance Tax liabilities

Let’s Reduce That Inheritance Tax Together!



Posted on: 23rd April 2024

Everyone wants to know how to reduce their various tax liabilities most effectively. Many people fail to recognise that this takes a lot of expert advice and careful planning and consideration. Inheritance Tax (IHT) is one area that requires a lot of expert advice from independent financial advisers Cheshire, especially if you want the very best outcome for your loved ones with your estate after you pass. At Haven IFA, our trusted advisers have helped many families with reducing Inheritance Tax liabilities, and we can do the same for you. To help you grasp the ways you can take control of your IHT, we have provided some ways to help minimise the impact that this unfortunate tax has.

Utilise the Nil Rate Band

Every person has a tax-free allowance known as the Nil Rate Band. Currently, that amount sits at 325,000. By working with independent financial advisers Manchester, you can work to plan your estate around making the most of this allowance.

Additionally, you could consider the Residence Nil Rate band, which provides an additional allowance for passing on your main residence to direct descendants. This is an avenue well worth exploring how much it can minimise within your estate planning.

Gifting Throughout Your Life

As you may already be aware, you can take advantage of annual gift exemptions of 3,000 every year, small gift exemptions of 250 per person per year, and wedding/civil partnership gifts that can additionally help to reduce the value of your estate subject to IHT.

Making regular gifts out of your income that does not affect your standard of living can also be exempt from IHT, provided they all meet certain conditions. This is something that our financial advisers can work with you to ensure and keep everything in line.

Gifts to registered charities are exempt from IHT, which means gifting to these bodies will reduce the overall IHT liability.

Pension Planning

At Haven IFA, our team consistently works with clients seeking pension advice Manchester. As pensions generally fall outside of your estate for IHT purposes, they can be passed on tax efficiently to your beneficiaries.

Trusts can also be a very useful avenue in your estate planning to pass on your assets away from tax, but this is an area that will require a lot of complex and careful consideration – which our team can help you to navigate.

Reliefs and Policies

Certain business and agricultural assets qualify for relief from IHT, and if you own such assets, we can explore how these reliefs can be best utilised within your estate planning.

Proceeds from your life insurance policies written in trust will typically fall outside of your estate for IHT, but it pays to be sure by including them in talks with your adviser.

Ready to talk? Our advisers are to help you with reducing Inheritance Tax liabilities! Estate planning is complex and laws can change, but our advice will always be tailored around them to minimise your IHT liability in line with where you wish your legacy to be left.

Contact the team at Haven IFA today.