Simply put, Inheritance Tax is the tax levied by HMRC on the estate of a deceased person. Inheritance Tax includes the deceased’s property and money, together with any of their possessions.
When is Inheritance Tax payable?
As a rule, you will not pay Inheritance Tax if:
the value of your entire estate, not just the house you live in, is below the £325,000 threshold, or;
you will also get an extra £325,000 on the death of a spouse if they have used Nil rate band, and;
an additional relief may also be available called the Residential Nil rate band.
IHT is complicated and complex and dealing with it by yourself can be emotional and stressful. The relief for the last two points is not straight forward. Advice would certainly be helpful to relieve the emotion and stress
However, even if your estate is less than the current threshold it will still need to be reported to HMRC.
Dealing with the complexity of Inheritance Tax
Inheritance Tax is a very complex subject and dealing with IHT issues, at a time of stress and grief, can also be overwhelming for your loved ones.
At McCabe Ford Williams Chartered Accountants we can assist you and your family with all the advice required for effective Inheritance Tax Planning.
We will explain Inheritance Tax in plain English and be on hand to help to reduce stress for all concerned.
It’s never too early to plan Inheritance Tax
Although not an easy matter to consider if you wish to maximise provision for your family/beneficiaries you do need to plan your affairs in advance.
The earlier you make arrangements, the greater the chance of taking full advantage of the Inheritance Tax planning opportunities available. This will minimise the amount of money that is paid over to H M Revenue & Customs and reduce the burden on your loved ones.
Issues to consider
There are many issues to consider when planning to transfer your estate. You need to ensure that you strike the right balance between maximising tax savings and making adequate provision for yourself and your family during later life.
We can help you:
Review the terms of your will
Utilise exemptions and lower tax rates on lifetime transfers of assets including transfers between spouses
Transfer a business (including shares in family companies) or agricultural property
Transfer assets into trusts
For more help with Inheritance Tax and Inheritance Tax planning contact your local MFW office.
Our Senior Partner, Ian Pascall FCA, recently issued a blog following a review made by the Office of Tax Simplification (OTS) to the Chancellor making their recommendations to Inheritance Tax. You can read his blog here.