Tax Planning

Inheritance tax is not just for the rich

With the mention of Inheritance Tax, most people simply dismiss the possibility that their estate could ever
be liable, assuming it is a tax paid only by the rich…

…this is far from the truth.

Take a moment to add up the value of all your assets - your home, personal possessions, savings, investments, life assurance and even your car…

…if this adds up to more than £300,000 - on your death, the taxman will deduct 40% tax from the value of any assets over this figure that you will pass on!.

So, as you can see - this is a very real tax and can effect more people than it would first appear - and at a rate of 40% for everyone, it can be very costly for those inheriting.

Assessing your Inheritance Tax liability

The inheritance tax Nil Rate Band stands at £300,000 for the 2007/08 tax year, which basically means that if the value of your estate (all your possessions, including your house) exceeds £300,000 - then your heirs may have to pay tax on everything above this at a rate of 40% when you die.

Your house is the most obvious asset, but there may be many others, for example savings and investments, pensions, jewellery, collectibles, as well as other items of value you own including a business. In addition, there are other items which may be chargeable to IHT which you need to consider.

How do I mitigate Inheritance Tax?

There are now many options to help you reduce or even eliminate your potential inheritance tax liability altogether and as everybodys circumstances are different, effective inheritance tax planning requires a tailored solution, which is where we can help.

There are a number of basic steps you can take to secure your family’s inheritance:

• Order your finances tax–efficiently
• Make a Will
• Value your assets
• Transfer assets
• Understand your pension death benefits

So, if you want to ensure that your assets go to the people or charities you want them to go to, you need to plan your inheritance carefully and as Independent Financial Advisers, we can explain what the most suitable options are for your individual circumstances.

Points to consider

• How much inheritance tax would your estate have to pay if you were to die today?
• What legacy do you intend to leave behind for those who follow?
• Have you used all of your inheritance tax exemptions?
• Does your Will make the best use of the inheritance tax provisions?
• How sure are you that any gifts you have made to avoid inheritance tax are effective?
• Do you wish to mitigate inheritance tax but need your investment income?

So, if you feel you could be liable for IHT, independent financial advice could save your estate and your heirs a great deal of money.

Contact us now for a confidential discussion.

The Financial Services Authority do not regulate Inheritance Tax Planning and Will Writing

The levels and bases of taxation are subject to change.

The guidance provided within this website is subject to the UK regulatory regime and is therefore primarily intended for consumers based in the UK.

This site does not confer any form of personalised financial advice, should you wish to receive specific financial advice please contact us.

Coombe Financial Services Ltd. is an appointed representative of Interdependence Ltd. which is authorised and regulated by the Financial Services Authority. Interdependence Ltd. is entered on the FSA Register (www.fsa.gov.uk/register) under reference 149826