Inheritance Planning from Lucra Ltd in Sutton, Surrey and Bromley, Kent

Being independent financial advisers allows us to work on YOUR BEHALF!

What Inheritance tax, if any, would be payable? (previously known as “Death Tax”).


Inheritance Tax (IHT) is usually paid on an estate when somebody dies excluding members of the Armed Forces whose death is caused or hastened by injury while on active service. (This exclusion is set to extend under the Finance Act 2015 to include members of the emergency services and humanitarian aid workers whose death is hastened as a result of responding to emergency circumstances). IHT is also sometimes payable on trusts or gifts made during someone’s lifetime. Most estates don’t have to pay Inheritance Tax because they are valued at less than the threshold (£325,000 in 2016/17). Tax is payable at 40% on the amount over this threshold or 36% if the estate qualifies for a reduced rate as a result of a charitable donation.

Married couples and registered civil partners can effectively increase the threshold on their estate when the second partner dies – to as much as £650,000 in 2016/17. Their executors or personal representatives must transfer the first spouse’s or civil partner’s unused Inheritance Tax threshold or ‘nil rate band’ to the second spouse or civil partner when they die.

There are certain transfers that are exempt. Broadly these are:
• Transfers to a UK domiciled spouse
• Transfers to charities
• Transfers to political parties
• Lifetime transfers to an individual or an absolute trust after which the transferor lives for at least seven years and contain no reservation of benefit by the donor are known as ‘Potentially Exempt Transfers’
• If such transfers are survived by less than seven years, but more than three years, taper relief may apply. Taper relief reductions work as follows:

 

Years transfer survived by

3-4 4-5 5-6 6-7 7+
Percentage of tax payable 80% 60% 40% 20% 0%
  • Lifetime transfers out of income which do not reduce capital (i.e. one does not have to resort to capital to supplement diminished income)
  • The first £3,000 of a lifetime transfer in any tax year is exempt. This exemption can be carried forward for one tax year if unused
  • Lifetime gifts to any person that do not exceed £250 in a tax year
  • Lifetime gifts in consideration of marriage – the exempt amounts are £5,000 from parents, £2,500 from grandparents and £1,000 from others

In addition to the nil rate band a new allowance, the Main Residence Nil Rate Band, will be phased in from April 2017. This will apply when the main residence is passed on death to direct descendants. Each individual will have an allowance and the rates are as follows:

Tax Year Allowance
2017/18 £100,000
2018/19 £125,000
2019/20 £150,000
2020/21 £175,000

This will also be transferable to the surviving spouse or civil partner on first death. This means that an individual will be able to transfer up to £500,000 on their death without incurring an inheritance tax charge, or up to £1 million on the second death. The additional nil-rate band will also be available when a person downsizes or ceases to own a home on or after 8 July 2015 and assets of an equivalent value, up to the value of the additional nil-rate band, are passed on death to direct descendants. There will be a tapered withdrawal of the additional nil-rate band for estates with a net value of more than £2m. This will be at a withdrawal rate of £1 for every £2 over this threshold.

Business Property Relief and Agricultural Property Relief may allow business persons and farmers to make IHT-free gifts of some of their business interests.

Being independent allows us to work on YOUR BEHALF!

What Inheritance tax, if any, would be payable? (Previously known as “Death Tax”).

For 2016/17 tax year, the IHT threshold is set at £325,000 and any chargeable estate over this amount is taxed at 40%.

Would you like to gift monies to grandchildren or set up a Life Insurance Trust for beneficiaries?
Are you concerned what would happen if you required long term care. How would you pay nursing home fees?

We can provide you with the appropriate advice and guidance to help safeguard your estate for your family, and ensure your wishes are taken care of. There are a range of products related to Inheritance Tax Planning we can discuss with you, please contact us to arrange a mutually convenient time to meet up.

INHERITANCE TAX PLANNING, WILL WRITING, TRUSTS AND TAXATION ARE NOT REGULATED BY THE FINANCIAL CONDUCT AUTHORITY.

For more general information on Inheritance Tax, please visit the public interest site  www.inheritanceissues.co.uk

SHOULD YOU CHOOSE TO USE THE ABOVE  LINK YOU WILL BE DEPARTING FROM THE REGULATED SITE OF LUCRA LTD. NEITHER LUCRA LTD OR TENETCONNECT NETWORK ARE RESPONSIBLE FOR THE ACCURACY OF THE INFORMATION CONTAINED WITHIN THE NON-REGULATED SITE.

Why Use an IFA?


Thank you for visiting the website of Lucra Ltd. Financial Advisers with offices in Sutton, Surrey. Many people think an IFA is only for the wealthy but this is not the case. The majority of our clients are everyday people from all walks to life. Our services are open to everyone. Getting the right advice means speaking to the right people. We are at your service and will happily visit you at home or work to discuss your requirements. Call us today for an appointment. Under our services tab above, you will find the services that we offer at Lucra Ltd from our offices in Sutton, Surrey. We offer a wide range of services such as mortgages, risk protection, life insurance, pensions, savings, investments, wealth management, equity release, long term care and investment planning. We can offer taxation advice such as inheritance tax planning. We also offer family financial assistance such as school fees planning, baby bonds, child savings plans as well as will writing and estate planning.

INHERITANCE TAX PLANNING, WILL WRITING AND ESTATE PLANNING ARE NOT REGULATED BY THE FINANCIAL CONDUCT AUTHORITY.

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Find us.

Suite 6, Tudor Court, Brighton Road
Sutton, Surrey SM2 5AE


Call us.

0208 722 0734


Email us.

web@lucra.org