Under the current Inheritance Tax system when an individual dies if their estate is under £325,000 their estate should not have to pay any Inheritance Tax. If it is over that level, any amount that you are over by is taxed at 40%! So you do not need to be over the level by a large amount before the Beneficiaries of your estate start to be burdened with a rather large tax bill!
A change to the system a few years ago introduced a most welcome tax relief for married couples in that a married couple (or registered civil partners) can now effectively inherit the tax allowance of their late spouse, meaning married couples are allowed up to £650,000 (Winter 2013) before their combined estates are forced to pay Inheritance Tax.
Due to more reasonable house prices than our friends in the South, this new system for married couples has meant that a lot of people in the local area are now unaffected by Inheritance Tax, however those who are above the levels set often want to know what they can do to avoid their estates having to pay this tax in the event of their death.
This is an incredibly complicated area of law, and one that takes a great deal of advanced planning, but if Inheritance Tax is likely to be a problem for you the benefits of taking good advice and carefully planning ahead can save your family some significant amounts of tax in the long run.
There are many different options for individuals to consider, and the best option is always to book an appointment to discuss your personal circumstances with one of our specialist solicitors.