Inheritance Tax and the Budget – what does that mean for you?
Inheritance tax was a hot topic before the budget. What changes would be made? Would a gift tax be introduced?
Despite all the speculation the budget was silent on inheritance tax so what does that mean for you?
Whilst this budget brought in no changes no one can say what will be brought in the future, so our advice to clients is to review their situations and get their succession plans and affairs in order before a future budget brings unwelcome changes.
There are many inheritance tax allowances, reliefs and exemptions some more commonly known than others.
Most people know that gifts to charity are exempt from inheritance tax and that they have an inheritance tax allowance of £3,000 per year. But what about the small gifts allowance, the gifts out of excess income allowance and the marriage exemption? Are you making maximum use of these?
Pensions and life insurance policies should also be reviewed to make sure these are being passed onto your beneficiaries in the most tax efficient way?
And what about the additional inheritance tax allowance? This is an allowance that is available when you leave your home to your descendants but without careful planning this allowance can be lost. For example, you will start to lose the allowance if your estate is worth more than £2m and you could lose the allowance completely if you leave your home into a discretionary trust that your children can benefit from.
Here at Trethowans our experts will review your affairs and advise you on mitigating your inheritance tax liabilities and structuring your will in the most tax efficient way.