Inheritance tax is hanging over more and more of us each year. This is largely due to the rise in residential property values. The current IHT allowance is £300,000 (2006/2007 £285,000). Depending on the value of your house and other assets this may not be that big an allowance. If you die leaving an estate worth more than £300,000 (2006/2007 £285,000) and you have no spouse your estate will come in for IHT at 40% on the balance.

The inheritance tax threshold is currently £300,000 and will be raised to £312,000 next year (April 2008).

Even if you do have a spouse to inherit then this only puts off the time when tax will be payable because he or she will also pass away one day. It is worth doing some forward planning with a tax adviser to decide whether it would be appropriate to gift some of your estate, perhaps to children or other relatives, during your lifetime; or possibly redirect assets up to the value of the nil rate band into a trust on death.

One thing is for sure with all forms of tax; if you do nothing the government will use its considerable powers to make sure a share of your hard earned wealth ends up in their coffers.

Levels, and bases of, and relief's from taxation are subject to change.

Contact us

FREEPHONE 0800 1075 123