Inheritance Tax Advice

Inheritance tax is a major source of worry for many people who are understandably concerned that the government will take the lion’s share of the money in their estate, leaving future generations with only a fraction of the wealth they worked so hard to create. It’s a complex area of law and mistakes can be costly.

We understand these anxieties and can help take the stress out of planning for inheritance tax on your money, property and possessions. Our specialist advisers have a wealth of experience in this area of law. With our guidance, you can plan ahead to minimise the amount of inheritance tax your estate will pay.

Our specialist tax solicitors can assist you with:

• Setting up tax efficient will trusts

• Making lifetime gifts

• The transferable nil rate band legislation allowing married couples and civil partners to minimise inheritance tax

• Making tax-efficient charitable bequests

• Tax relief available on agricultural and business property

• Inheritance tax-saving arrangements for high-net-worth estates

• Advice on the use and availability of the Residence Nil Rate Band

Nil Rate Band

Inheritance Tax is paid by the deceased’s estate rather than beneficiaries, subject to contrary provision in the Will. Currently, the first £325,000 of your estate is taxed at 0%. This is known as the ‘Nil-Rate Band’ and although it is a ‘rate’ of tax it means that amount is not subject to inheritance tax. The threshold for the ‘Nil-Rate Band’ is revised by the Government from time to time.

The current Nil Rate Band came into force in 2009 and is not expected to be reviewed until the 2027/2028  ends. Any change will be announced in the Budget each year. 

Any assets over and above this threshold are taxed at the rate of 40%. So, for example, if you have a total estate, including the family home, worth £500,000 then you will pay 40% tax on £175,000. This works out at a hefty tax bill of £70,000.

On 6 April 2017 a new ‘Nil Rate Band’ was introduced relating to the transfer of residential property to lineal descendants starting at £100,000 and increasing annually by £25,000 until 2020/21 when it reaches the maximum threshold of £175,000. This is the Residence Nil Rate Band (RNRB). Again this is not expected to be reviewed until the 2027/28 tax year ends.