HM Revenue & Customs are rubbing their hands at the news that tax receipts for inheritance tax in the year to 31 May 2017 increased by 9% on the previous year’s tax take. The receipts jumped from £4.7 billion in 2016 to a massive 3%.1 billion.
People who have seen their estates increase on the back of property price growth are now being clobbered by the taxman. The situation is made worse by the fact that the IHT nil rate band has been frozen at £325,000.
There is another reason why taxpayers are forking out so much and that is not including inheritance tax planning as a part of their overall financial strategies. Paul Howkins, managing director at Keens Shay Keens Ltd, said “IHT has evolved from a tax on the rich to being a tax on the man on the proverbial omnibus; I expect that the upward trend in revenue receipts will continue.
There are many legitimate ways in which IHT can be mitigated, effective planning does tend to be bespoke because each individual’s circumstances are unique. It is generally agreed that if you want to help preserve your wealth for future generations, the earlier you start planning the more effective that planning will be.
At Keens Shay Keens Ltd we offer real life solutions to all your business and personal family needs. We believe that our expertise can help you and your family along every step of life’s journey. It is no coincidence that we continue to offer services to second and third generation business families.
Rather than trusting the ‘man at the club’ with your inheritance tax planning and your family’s future, why not invest your trust in the future with the professionals.
If you would like to review your inheritance tax position please contact Paul Howkins or Paul Southward.
The need for IHT Planning is highlighted by record tax receipts.
With the current revelations about offshore trusts, tax havens and the disclosures about our political leaders tax affairs you may think that tax planning is all but dead and gone. This is certainly not the case, some sensible steps based on sound, legitimate and lawful advice could knock thousands of pounds in inheritance tax (IHT) for you and your family.
The need for IHT planning is highlighted by the fact that IHT receipts leapt to a record £4.6bn in the year to February 2016 a rise of 21% on the previous year’s total of £3.8bn.
A part of that increase is probably down to increases in property values bringing many more estates within the charge to IHT. The situation has been exacerbated by the fact that the starting threshold for paying IHT has remained unchanged for almost 7 years.
So where do you start? Whilst we would recommend that you only take IHT Planning action after taking expert advice, there are things that can be done to ‘prepare the ground’ this will make it easier for your adviser to focus on the specific needs of you and your family and provide advice that is relevant to you and your family.
So here are some simple steps that will get you started:-
1. Make a list of all your assets and make an estimate of each asset’s current value. If you are married or in a civil partnership make a separate list for each party, split the value of jointly owned assets according to your share.
2. Consider future inheritances you may receive are you likely to be the beneficiary of a will or perhaps a trust? Do you own or have an interest in any capital assets that are likely to be sold within the next 5 to 10 years? Make a separate list.
3. Make a list of all your income sources and the yearly income received from each source. Also make a list of all your outgoings.
4. Think about significant future outgoings you may incur over the next 5 years or so, education costs, weddings etc. and make note of these.
5. Have you already made gifts to your family? You should keep a record of any significant gifts that you have made.
6. Think about your path in life over the next 5 to 10 years and consider where it may take you, and where you would want to be.
7. Now draw up your current family tree include all from whom you may benefit, current dependents and others who you wish to benefit from your estate.
Now you can give us a call and we can lead you on to the next leg of your journey by providing you with the sound, legitimate and lawful advice you need to plan for your and your family’s future. We may not save you any tax but the peace of mind you will achieve will bring rich rewards.