Posted on: 31st October 2014
It’s time to reflect on the unveiling of a big idea.
The impending demise of the ‘death tax’. And if you don’t already know, that’s the 55% duty that’s paid when you die.
The proposed new duty is around 20% of thepots of those who die after the age of 75.
Anyone dying before that will be immune. If you lose your parent while under the age of 23 then you also don’t pay the tax.
So the idea in a nutshell is that we’ll all be able to leave more money to our loved ones after we die.
Keeping It In The Family:
This is an appealing idea for those of a certain age. It has instant appeal to those who have worked and saved all of their lives and want to simply pass on their hard-earned money to their families without the threat of tax.
For the Conservatives, it’s a huge deal in terms of getting the votes. And has certainly been welcome news in many quarters.
It’s no surprise that many older voters have drifted to the UKIP camp. The Conservatives and George Osborne definitely needed something to lure them back. And a strong stance on inheritance tax is a wise move.
What The Future Holds:
This and other pension changes will certainly help the Conservatives win votes, but will Osbourne raise the inheritance tax threshold to £1m as suggested going into the next election?
Who knows. It will always be one of those issues that grabs people’s emotions.
How Will It Affect Me?
Atwe want to help people avoid paying death tax when they don’t need to. So it’s really important to understand whether you will pay inheritance tax or not and what to do about it.
Know this: You will have to pay if you have plenty of cash, investments or property as well as policies. And it’s a whopping 40% to pay if that’s over £325,000. But that’s what Osborne has proposed to change. So it could be that it’s 40% but only above assets of £500,000.
If you give money away before you die, then it could avoid paying tax altogether. The key is to gift it seven years before you die. Unfortunately, this means making some preparations.
Whatever your situation, Haven IFA can help. Call our friendly team now for more information on Inheritance Tax and make sure your savings are working for your family.