After all the taxation in your lifetime, on
both income and capital gains, the Inland Revenue demands the final say with
Inheritance tax.
But does it have to? The "Death Tax" has often been described as the
"voluntary tax". If you give enough away during your lifetime, and you survive
long enough to avoid any tax claw-back, then you could still have the last laugh - leaving
no more than an amount equal to the "Nil Rate Band" where no tax applies.
How in practice can you do this and still leave yourself, and equally your spouse,
enough to live on for the rest of your lives? And what are you to do about your house -
possibly your largest single asset?
Inheritance Tax has many exemptions and reliefs and a useful starting point is to
consider them. However, taking advantage of them in practice can be quite complex.
For a gentle introduction to the subject, go to
www.direct.gov.uk,
click on 'Money, Tax and Benefits' and follow the links to Inheritance Tax.
A bespoke solution to inheritance tax is necessary as it will depend on the
circumstances of each case. For example, what do your assets consist of and to what extent
do you need them to generate income? Crucially, particularly for married couples, what
flexibility is needed in terms of future access to capital or income, perhaps after the
demise of the first to die?
A range of inheritance tax solutions is available which, individually or in combination, can meet most
people's objectives and circumstances, and achieve a great deal. However, individual advice is
essential.
If you would like help
from an independent financial adviser then you can use this search link Search for Independent Financial Advisors
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