Inheritance Tax
Life’s Certainties – death and taxes
Inheritance Tax
Inheritance Tax (oddly shortened to IHT) is often viewed as an immoral tax. You pay tax on your income and savings, and then when you die your beneficiaries pay inheritance tax (or death duties). There are various allowances that can be used to reduce the tax which may mean that some people don’t pay any. There are simple and complex solutions.
At the moment IHT is charged at 40% on the excess of an estate worth more than £312,000 or £624,000 for a couple. This allowance changes each year and is subject to political whim. Assuming that you use up your permitted allowances in essence there are only two options for you to consider doing with the balance of your estate whilst you are alive.
- Give it away (to beneficiaries or charity) or
- Spend it
This assumes that the law does not change (which is a dangerous assumption!). We can help you to plan for the probable tax and help to reduce its impact on your estate. Your personal circumstances need to be considered very carefully. You may need the money yourself, perhaps to provide for care in your late life. We are generally reluctant to set in motion arrangements that are based on fixed assumptions about the possible taxes upon your death. We will discuss options with you very carefully and guide you towards making sensible provision without compromising your future well-being.
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