Maximising what you leave behind
This article is for people who may be leaving over £325,000 in their will. We know that this sounds like a huge amount; but remember the average property sale in Southport last year was valued at £196,109, according to Rightmove. Rightmove say that “Most of the sales in Southport over the past year were semi-detached properties which on average sold for £178,188. Detached properties had an average sold price of £320,924 and flats averaged at £122,552”.
Inheritance Tax (IHT) is often described as a voluntary tax. This does not mean that at the time you die the Revenue asks whether you would like to pay the tax or not; however, it is a voluntary tax in the sense that if you take reasonable steps in good time, the tax can be reduced or possibly eliminated altogether.
Usually the tax is easy to calculate. When you die the first £325,000 is exempt and everything else is taxed at 40%. If you are a widow or a widower then you will normally benefit from the transferrable Nil Rate Band so that your allowance will double to £650,000; however this is not always the case. The rules around Inheritance Tax are very complex. There is usually a lot at stake and it therefore makes sense to take advice from a company which specialises in IHT Planning.
IHT is complicated. For example, did you know:
- That you can avoid inheritance tax after just two years instead of the usual seven years?
- That if you have an insurance policy to pay your inheritance tax, you probably don’t need it?
- That there are 7 Inheritance Tax Exemptions and Allowances which can be very useful?
- That If you don’t update your Will you could lose a £70,000 Inheritance Tax break?
- That you can give unlimited sums to your children free of Inheritance Tax and there is no 7 year time limit?
- That you can use your pension pot to reduce or even avoid your Inheritance Tax?
- That you can save up to £400,000 in inheritance tax?
- That using an Equity Release product is a good way to reduce your Inheritance Tax?
To speak to our carefully chosen solicitors about wills, inheritance tax or any other legal issue; please call us on 01704 542 993 to get the specialist, expert advice you need and make sure that more of your money goes to the people you love.