The transferable nil rate band
Since the introduction of the transferable nil rate band in 2007, there is less of an “industry” in advising couples to put discretionary trusts of the nil rate band in their wills so as to ensure that they get the benefit of both exemptions. However there are still good arguments for having trusts of that sort in your wills, not least the possibility of a future change in the law. Everyone’s situation is different so a one to one discussion to see what’s right for you is essential.
IHT relief on business property
If you have your own business, there is a lot that can be done by way of your will to maximise the IHT relief on business property, especially if you are married.
If the nil rate band (and any transferable one) isn’t enough to keep all of your estate out of the tax man’s clutches, there are things that can be done during your lifetime to reduce the IHT burden.
Placing pension benefits and life policies into trust, Lifetime trusts, and Exemption for gifts out of income
I often work closely with specialist accountants and financial advisers in this field and, if enough is at stake, this multi disciplinary approach can be very worthwhile for my clients. For example, we might want to make sure that pension benefits and life policies are written into trust, we might want to set up a series of lifetime trusts so that they all have a tax free status after you have died and we might want to look at using the very valuable exemption for gifts out of income so that you can pass on as much as possible during your lifetime without having to worry about the 7 year rule.
Leapfrogging the generations
Leapfrogging the Generations – As our parents are blessed with longer and longer life spans, we often find that we inherit substantial sums from them at a time when we ourselves are financially secure and trying to find ways to shield our own assets from inheritance tax. As long as you act within two years of death, you can divert your inheritance down a generation or into a trust so that it won’t get taxed when you die. You won’t even have to survive for another 7 years, because all this will be treated as having been done by the person who has already died. We can even arrange it so that you can carry on taking income or draw down of capital from the inheritance, by being a discretionary beneficiary of the trust.
Remember, my first meeting with you is at no obligation to you. This will give you the chance to see what might be possible and the likely cost involved.
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