what we do

Wealth Management

Inheritance Tax

The IHT Nil Rate Band threshold, below which no IHT is payable, is £325,000 for 2009/2010 and set to rise to £350,000 in April 2010.  If your assets, including property, life insurance, pensions, savings and other possessions are worth more than this you may have an IHT problem.
 
The earlier you start thinking about IHT planning, the more you may be able to save.    Lifetime giving options you might want to consider include:

• An annual exemption of £3,000 per year
• Gifts of up to £250 per tax year to any individual (apart from the person who has received £3,000 under the annual exemption rules)
• Gifts out of normal expenditure; this exemption is often overlooked and can save substantial amounts over a period of time
• A wedding gift of £5,000 from a parent to a child, and lesser amounts to more distant relations or friends.
• Potentially exempt transfers; these offer the greatest scope for passing money down the generations but do rely on you making the gift, and ceasing to benefit from it, at least 7years before your death for it to be completely tax free.

 

More details can be found in our ‘Saving tax by lifetime giving’ leaflet download.

Trusts
There are now added complications in placing assets in trust during your lifetime but it can still have significant tax and management advantages. Careful use of Wills and trusts created by Wills may also reduce the IHT liability.  We will be happy to discuss these with you in relation to your own particular circumstances.

Nil Rate Band
Since 2007, married couples have been able to benefit from the ‘Transferable Nil Rate Band’.  Put simply, this enables one spouse to leave all their assets to the other without creating an Inheritance Tax problem if their total joint wealth falls under their joint Nil Rate Band allowance (currently £650,000).  However, the detail of the rules is actually quite complex.  More information can be found in our ‘Transferable Nil Rate Band – What are the Practical Implications’ leaflet download.

Other Taxes
IHT should not be looked at in isolation, but in conjunction with other aspects of tax planning, particularly Capital Gains Tax.

For individual advice please contact Robert Chalmers in our Norwich office, Jennie Pratt in Cambridge or Simon Crooks in Bury St Edmunds.

"Personal circumstances change. Caring for your loved ones as situations develop can be difficult. And should a loved one die, there is a lot to do. Let us help, and share that burden with you."