Reduce Inheritance Tax
Inheritance Tax Mitigation
Obviously, none of us like paying more tax than we absolutely have to.
WE ARE HERE TO HELP & ADVISE YOU
Which is why JNJ Financial Management, as Inheritance tax specialists, can make the most of totally legitimate planning opportunities that exist, to help reduce your Inheritance tax liabilities and ensure that your estate pays no more Inheritance tax than is absolutely necessary..
IHT is a tax levied on all taxable transfers out of estates which are above the nil rate band (this is currently set at £325,000 per person), either at death or during lifetime. Transfers at death above the prevailing nil rate band, are levied at a flat rate of 40%.
There are however various allowances and reliefs available to help you reduce the potential liability (see below).
In the event of your death, based upon an estate valued at say £500,000 some £325,000 would pass to your beneficiaries free of tax and the balance of £175,000 would then be subject to 40% tax. In cash terms this means your children (or other beneficiaries) could face a tax bill of £70,000 !
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Transfers between spouses at the time of death of either spouse, are free of IHT under what is known as inter-spouse exemption.
Surviving spouses can claim any unused part of an earlier deceased spouse’s nil rate band, thus effectively giving a tax free allowance of up to £650,000 per married couple.
By way of a further example of potential liabilities, an estate valued at say £2,000,000 in total (to include all property and investments etc), would see an inheritance tax charge of £670,000 levied on the estate of a single person.
This sum, however, could be reduced to £540,000 if the deceased had previously lost a spouse with unused nil rate band.
There are various IHT allowances and reliefs to help you reduce the impact of IHT on your estate, albeit in reality, apart from the nil rate band allowance, some of the other allowances can be relatively insignificant, particularly to a larger estate.
- Nil rate band of £325,000. This means the first £325,000 of your estate will pass to your beneficiaries, without any tax liability at all.
- An annual lifetime gift allowance of up to £3,000 in any tax year
- Lifetime gifts of £250 per tax year, to any number of individuals,
- Wedding or civil partnership gifts of up to £5,000 for each of your children,
- Wedding or civil partnership gifts of up to £2,500 for each of your grandchildren,
- Wedding or civil partnership gifts of up to £1,000 to others,
- From April 2017, a new ‘home allowance’ is being phased in.
JNJFM are highly experienced Inheritance tax advisers and can advise you upon a variety of routes (depending upon your specific circumstances, assets and income) and show you how to reduce your Inheritance tax liability.
In some cases a single strategy may be the most effective route to mitigation. In other cases it may be necessary to adopt a multiple strategy approach.
A key to successful IHT planning & mitigation however, is ‘thinking and planning ahead’.
JNJ Financial Management will never act outside the law to assist you evade tax. Tax evasion carries severe penalties.
So why not contact IHT specialist advisers JNJ Financial Management today?
Tel: 01926 641888 …
Or send us an e mail to: firstname.lastname@example.org)
… for a no obligation, informal chat and review of your existing IHT liabilities ?
You could soon be on the way to reducing your children’s (or other beneficiaries) onerous burden to pay IHT?
We are appointed representatives of The Tavistock Partnership Ltd., which is authorised by and regulated by the Financial Conduct Authority (FCA).
Please note that tax advice which contains no investment element is not regulated by the Financial Conduct Authority.
We have found JNJ to be friendly, helpful and informative.
JNJ have guided us regarding our estate planning and their advice has helped us to significantly mitigate our Inheritance Tax liabilities.