Telephone: +44 (0)161 241 9400

 Email: info@touchsolicitors.co.uk

Address: 13 Cobden Street, Chadderton OL9 9LE

Tax planning

 When you work hard all your life it is understandable that you do not want more of your money to fade away into taxes.  Inheritance Tax is a huge concern for everyone, but it does not apply to all Estates and there are ways to mitigate how much you pay.

The current law says that you will pay Inheritance Tax (IHT) at 40% on any monies you have beyond £325,000.  If you are married and you leave everything to your spouse, the allowance is combined and on the death of your spouse, the Estate will benefit from an IHT free allowance of £650,000.

From April 2017 there will be an additional Residence Nil rate band.  This will only apply for a residential property which is being passed to direct descendants. By 2020 a potential £1m could be passed IHT free.

Lifetime planning and simple measures can reduce your liability to IHT.  Where in depth planning is required, we work with trusted financial advisors to help plan your financial future in a cost effective manner.

Do not be mislead by advisors promising Inheritance Tax avoidance schemes.  If it sounds too good to be true, it generally is!  Asset Protection Trusts or Property Protection Trusts take two forms, either an Interest in Possession Trust or a Discretionary Trust (see our Trust pages).

Whilst the use of Trusts can assist with Inheritance Tax planning, you must note that transfers into a Trust during your lifetime may potentially attract Capital Gains Tax and IHT.  If you transfer the asset into a Trust but continue to have use of the asset, the asset will be subject to the Gifts with Reservation of Benefit Rules (GROB).  There is also Pre-Owned Asset Tax that could apply if you continue to occupy the property unless you pay rent for its continued use.

If you are trying to protect your money, ensure that you take advice from qualified experts who are regulated.  Our Solicitors will tell you what the law says and work to achieve the best possible outcome for you.

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