IHT planning for those who don’t want to change their lives. For all who believe that they will have an IHT liability on their death or that of their spouse or civil partner.
A life assurance policy – single life or joint lives last survivor (as appropriate) in trust for those who will inherit. This will provide tax free funds to meet the liability and preserve the value of the estate – undiminished by tax – for the beneficiaries.
Inheritance tax (IHT) will not damage your wealth but it could seriously damage that of your family.
Effective IHT planning usually involves you giving away or giving up something. There are some very effective solutions you could consider based on relevant investments and trusts. But it will involve you giving something up in relation to the assets or investable capital you carry out IHT planning with ie.
- absolute control
- your unconstrained right to income
- your unconstrained right to access the full value of the capital
If any or all of these consequences are unacceptable to you BUT you are still concerned about IHT then the answer for you (subject to health and cost) may be to effect an appropriate life assurance policy held in trust for those who will eventually inherit your estate.
If you are married or in a civil partnership and the first of you to die will leave your assets to the other on death, these will be exempt. In relation to the eventual liability on the death of the survivor this should be covered by a policy which pays benefits on the death of the second of you and your spouse/civil partner to die.
The premiums will usually be exempt and the sum assured IHT free and paid without waiting for probate.