Inheritance Tax (IHT) or death duty, is a voluntary tax, as such we help our clients by legal and ethically approved methods, reduce, even avoid the of taxes on legacies.Gone are the days when the burden of inheritance tax was a problem for the rich. Inheritance Tax Planning is a cost effective weapon a fighting the inherent wickeness of this tax. As the main dwelling constitutes a significant part of family or individual wealth, the increase in property values over the last couple of decades has potentially subjected several estates to a liability to inheritance tax.
Inheritance tax in our opinion is a wicked tool to deprive innocent people of the fruit of their hard work it reduces the amount people may pass to their heirs by sometimes more than 50%. As experienced estate planners, we are saddened that people are mislead into believing that IHT calculations can be done on the back of a fag packet by using the formula:
IHT Payable = (Total assets IHT Current Allowance) x 40%
While it is true that this is the basis of the calculation of the tax payable, it is merely the beginging of the story. The above formula is perhaps useful as a mathematics question for a ten year old child. It fails to encompass the complexities of an adult life, it does not recognise inherent intention most of us have to retain our wealth in our family several generations down the line. This formula does not recognise the experience that a suitably qualified financial planner would bring to bear at every consultation and deploy the tips knowlege and experience that would save you and your family tens, even hundreds of thousands of pounds in inheritance tax.