Inheritance Tax Advice & Planning

Many of us fall into the inheritance tax bracket - very often without realising it.

Each of us has an allowance that is exempt from Inheritance Tax on our death (currently £325,000).

This amount, known as the Nil Rate Band, was invariably ‘lost’ to married couples as the surviving spouse could inherit any amount without liability to Inheritance Tax. However, the problem arose on the second death as the assets held by the surviving spouse were often over the Nil Rate Band leading to a tax charge of 40% of any excess.

If you are looking for advice on inheritance tax, or would like to ask a question please give us a call on 0141 331 0660 and we will be happy to help.

In October 2007, the previous government made substantial changes by allowing married couples, and couples who had registered their civil partnership, to claim any ‘unused’ amounts remaining of their Nil Rate Band after the first death and to add this amount to their Nil Rate Band on the second death.

For many married couples, this completely removed any liability to Inheritance Tax. Although, if your joint estate exceeds twice the Nil Rate Band (£650,000) then Inheritance Tax is still very much a problem: but a problem that can be solved.

However, for those couples who are not married, avoiding inheritance tax with a 'discretionary will trust' is one possible solution - it is perfectly legal and leaves you in control of your assets and income while you are alive.

Just as important is the fact that it leaves you or your spouse in control of assets and income when one of you dies.

So if you don't want to leave up to 40% of the value of your house and savings to the HMRC, this should be the cornerstone of your personal financial strategy. For most unmarried couples, this tax mitigation strategy is usually the most cost effective, and it can even be used for avoiding inheritance tax on the family home.

If you want to ensure that your hard-earned cash goes where you want it to, and not to the taxman, contact Warde Graham, Financial Advisers Glasgow, for advice. Proper planning can greatly reduce, or even wipe out completely any such tax liability.

Call us today on 0141 331 0660

Please be aware that not all Inheritance Tax Planning is regulated by the Financial Services Authority