The Chancellor’s Autumn Statement announced that starting in April 2027, money in a pension might be subject to Inheritance Tax (IHT). As a result, more parents are wondering if they should withdraw some tax-free cash now and give it to their children instead. If done correctly, it can be a good decision. If done incorrectly,
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Suppose your loved ones include children, adults with disabilities, or anyone who might struggle to manage money or personal decisions alone. In that case, a “standard” will could leave them exposed. The right will and, crucially, the correct supporting documents can safeguard their security, state-benefit entitlement, and long-term quality of life. Below is a practical
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Big changes are coming for family businesses regarding inheritance tax. If you own a family business, here’s what’s changing and what you can do about it. Why does it matter? Inheritance tax (IHT) is set at 40% on anything you leave beyond the £325,000 threshold. This threshold increases to £650,000 if you pass your unused
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If you’ve put in hard work to create wealth, it can be very frustrating to think about giving 40% of it to the taxman after you pass away. Luckily, there are ways to transfer your wealth efficiently and tax-free while you’re still alive, with one of the best methods being to give gifts from your
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If you’re considering estate planning, you’ve probably come across terms like “trusts” and “Inheritance Tax (IHT).“ There’s a helpful strategy using trusts that can help lower taxes called the Rysaffe Principle. Let’s see how this principle can work with trusts to protect your assets. How Do Trusts Play a Role in the Rysaffe Principle? Trusts
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The Autumn Budget updated inheritance tax (IHT), affecting how much of your estate you can pass on tax-free. Although less severe than expected, more people will likely pay IHT in the coming years. So, it’s important that you review your plans and minimise the potential tax burden. What’s Changed? Chancellor Rachel Reeves introduced three key
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One of the key announcements in the recent Autumn Budget was that starting in April 2027, Inheritance Tax (IHT) will apply to pension assets. This is a significant change that could greatly affect our retirement and estate planning. Let’s explain what this means. What’s changing? Pensions have been a great way to pass on wealth
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You might have heard that during October and March, there’s an initiative called Free Wills Month. If you are 55 or older, you can have a lawyer write or update your Will for free. This opportunity is funded by charities. While they hope you’ll consider leaving a gift to them in your Will, there’s absolutely
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When it comes to inheritance tax (IHT) planning, term assurance can be a game-changer. This life insurance product pays a lump sum if the insured person passes away during the set term. If they outlive the policy, there’s no payout. So, why consider term assurance? Affordable Family Protection Term life insurance is often the most
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In the 2021/22 tax year, the government collected £5.99 billion in Inheritance Tax (IHT), the highest amount ever recorded. This represents a 4% increase from the previous year. The rise has been attributed to various factors, including higher asset values such as property and investments. Additionally, more estates are now subject to IHT due to
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Dealing with the loss of a loved one is already difficult without the added stress of managing inheritance tax (IHT). If you have this challenging task ahead, you don’t have to worry, we’ve broken it down into simple, manageable steps. Whether you’re managing an estate or are receiving an inheritance, understanding the process can help
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It’s generally not a good idea to put your home into a trust during your lifetime. Some advisors suggest transferring a share of the home to a trust to increase tax allowances. However, if the amount exceeds certain limits, this can lead to immediate inheritance tax charges. All intentionally set-up trusts need to be registered
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Thinking about what happens after we’re gone isn’t fun, but it’s essential, especially for taking care of the people we love. That’s what making a Will is all about. It’s more than just a legal step; it’s how you ensure your stuff – like your house, savings, or other belongings – goes to the people
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For many people, ensuring that their loved ones are taken care of after their passing is a top priority. The Main Residence Nil Rate Band exempts those with assets below £1,000,000 from Inheritance Tax (IHT). However, some may find that their home attracts an IHT liability on death. If this applies to you, navigating the
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Inheritance Tax (IHT) is a topic that often sparks discussions about whether it should be abolished. According to a recent YouGov survey, many find it the least favourable tax. It revealed that 50% of respondents consider it ‘unfair’ or ‘very unfair’, while only 19% held the opposite view. Interestingly, there is a common misconception that
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In the 2022/23 tax year, inheritance tax receipts reached an all-time high. The trend seems to continue this year too. The government releases monthly data on tax receipts. In April, it showed that HMRC raised £7.1 billion through inheritance tax in 2022/23. Between 2013/14 and 2022/23, this represented a 108.3% increase in inheritance tax, which
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The deadline for registering trusts on the new Trust Registration Service (TRS) of 1st September 2022 is fast approaching. As a reminder, the new rules, introduced on 6th October 2020, extended the scope of the TRS to UK (and some non-UK) trusts. Previously, only Trusts that had to pay tax had to register; the requirement
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The Institute for Fiscal Studies (IFS) has published a new report on likely future inheritances. It may give a future Chancellor something to consider The Institute for Fiscal Studies (IFS) has regularly looked at inheritance and inequality. In its latest paper, it has gone into greater detail, drawing on data from a variety of sources:
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If a trust might generate taxable income or gains, HMRC required the trustees to register it with them. They did this using paper Form 41G (Trust). This was not the case where the trust would not generate any taxable income or gains. An example of this is where a trust holds an investment bond. What
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We all want the best for our grandchildren. We would also like to reduce the inheritance tax (IHT) our loved ones could pay when we die. For many, giving their children or grandchildren the best opportunities means private schooling. More than half a million children currently going to private schools in the UK. According to
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IHT receipts for April to October 2020 were £33 million higher than for the same period last year. October 2020’s receipts were also up 17% compared to October 2019. This could be due to the Covid-19 pandemic. What it does show is that many families who have not done any planning may have paid tax
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Thinking about your death is an uncomfortable topic. Combining this with money makes this even worse. There are three places your assets can go at your death. They can go to your family and friends, charities and other institutions, or the government in the form of taxes. Almost half of all Baby Boomers say they
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A Whole of Life Assurance policy with guaranteed premiums promises payment of a known level of cover upon death of the life / lives assured whenever death occurs, provided that premiums are maintained. The premium and sum assured are fixed throughout the life of the policy (in some cases it is possible to include an
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Although often in the news, Inheritance Tax (IHT) is easy to misunderstand. If you thought IHT was for wealthy people to worry about, think again. Rising property prices have meant more estates than ever are likely to face an IHT bill. The amount of IHT collected has doubled over the last decade. If your estate
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Perhaps you have been asked to be a trustee or you are considering setting up a trust yourself. In either case, there are a few things you should know before deciding. Being a trustee requires a certain level of involvement. This blog post should hopefully give an insight into what is involved. What does a
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Many of us go to great lengths to protect what we have while we are here. We put in alarm systems, smart doorbells, thick locks. However, most of us do not do anything about protecting what we have when we are gone. A new survey by the British Heart Foundation found 61% of people do
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