Inheritance Tax Advice

The annual amount of Inheritance Tax paid to the government over the last 10 years has risen from £1,558 million to £3.545 million*. That's a rise of over 127%.

From April 1997 to April 2007 the average UK house price rose from just over £57,400 to £180,314**. That's a rise of around 214%.

So it pays to be aware of your Inheritance Tax position. You can take sensible and straight-forward steps to ensure that your estate is protected as much as possible, within current guidelines.

However, the first concept that you need to understand is that there is no perfect solution to Inheritance Tax Planning. In many respects the worst thing you can do is to try and put a plan in place to get your Inheritance Tax position down to exactly zero by analysing your finances the nth degree. Such a strategy usually leads to significant delays in implementation of various solutions which is the worst thing you can do. Analysis, paralysis as they say.

Currently, the first £325,000 of an individual's net estate is not liable for Inheritance Tax duty. For married couples and registered civil partners this is doubled to £650,000, if the full allowance is passed to the surviving spouse. Anything in excess of this amount is taxed at 40% on death.

The chart shows two striking examples:

• How easily the HM Revenue & Customs can become the single largest beneficiary of your estate
• The larger your estate, the higher the percentage lost

Henwood Court can help mitigate your Inheritance Tax, and advise on positive courses of action such as:

• Transfer assets through the prudent use of lifetime gifts and Trusts that may provide you still with access to capital and/or an income within an inheritance tax friendly environment.
• Create a tax-efficient method to enable the beneficiaries of an estate to meet the tax liability without disturbing the family wealth.

Further information on the ways and means to mitigate inheritance tax and pass more onto your estate rather then HMRC may be found within our Estate Planning Guides.

Henwood Court can offer you specialist, helpful and clear advice on Inheritance Tax, to help you make an informed choice. Our qualified advisors will ensure any decision is made only once you have all the facts in hand, and only as a result of establishing your personal wishes and criteria. Contact Us Today

* Source: hmrc.gov.uk as at April 2007
** Source: nationwide.co.uk/hpi as at April 2007

The information on this website is based on our interpretation of the law and HMRC practice as at April 2008. Taxation legislation and HMRC practice may be subject to unforeseen changes in the future. Wills and some areas of Inheritance Tax Planning are not regulated by the Financial Services Authority.