Inheritance Planning Review can minimize the tax your children have to pay
As Benjamin Franklin said, ‘the only things that are certain in life are death and taxes’, a statement which has stood the test of time and Inheritance Tax touches on both of these issues. When you pass away, an assessment is made as to the value of your estate, including cash, property businesses and so on. If you have not done any sort of Inheritance Planning Review and this exceeds the current nil rate band ( set at £325,000 until 2014) then your family will have to pay a whopping 40% tax on all other assets above this figure.
This tax bill can be reduced through various methods, but you must consider the impact of these options as there is rarely one solution which suits most people. For example the easiest way to avoid it is to gift your money away and live longer than 7 years so that the gift is completely outside your taxable estate. However there are obviously issues here regarding whether you would like access to this money again, whether it is wise to give your beneficiaries large amounts of money when they are young and so on.
Therefore we always advise people to seek professional independent financial advice before making any plans regarding their inheritance tax strategy.
