Pay what you owe, and not a penny more.
Honest advice on what Inheritance Tax will, and will not, do to your estate, and what you can do about it.
Inheritance Tax (IHT) is charged at 40% on the value of an estate over the nil-rate band (currently £325,000 per person). With careful planning, much of an estate can be passed on without an unnecessary tax bill. We work with you, and where helpful with your accountant or financial adviser, to make use of available allowances, reliefs and exemptions.
The basics, in plain English.
Inheritance Tax is a tax on the estate of someone who has died, charged at 40% on the value above certain thresholds. The standard nil-rate band is £325,000 per person; an additional 'residence nil-rate band' of up to £175,000 applies in many circumstances where a main residence is left to direct descendants.
Because spouses and civil partners can transfer unused allowances to each other on the first death, a married couple can often pass on up to £1 million between them without IHT, provided their estate qualifies. Most estates pay no IHT at all. The estates that do pay tend to involve property in the South East, business assets, or significant savings and investments.
What good IHT planning covers.
- The nil-rate band and the residence nil-rate band, including transferability between spouses
- The spouse exemption and how to use it without unintentionally building up tax in the survivor's estate
- Lifetime gifting and the seven-year rule, including potentially exempt transfers
- Annual exemptions and small gift allowances
- Gifts out of normal income (a powerful but underused exemption)
- Business Property Relief and Agricultural Property Relief, where they apply
- Charitable legacies and the reduced 36% rate where 10% or more is left to charity
- Will trusts that protect the nil-rate band on the first death
- Lifetime trusts where they fit your circumstances and objectives
How we work with your other advisers.
IHT planning is a team sport. The estate planner brings the legal structures (Wills, trusts, gifts in writing); the accountant brings the tax calculations and the wider tax picture; the financial adviser brings the investment and pension structuring. We work alongside both, and we would rather refer to a specialist than overreach. Where you do not yet have an accountant or adviser, we can introduce you to people we trust.
What IHT planning costs.
IHT planning is quoted individually after a free consultation, because the work depends on what is needed. For some clients, simple structural changes in a Will are enough. For others, a combination of Will trusts, lifetime gifts and trust planning produces the right outcome. We are clear in writing about what we will charge, and what each piece of work will achieve, before we start.
A clear process, from consultation to signing.
- 01
Free consultation
A no-obligation conversation about your circumstances and what you want to achieve. We listen, ask the right questions and explain your options.
- 02
Tailored advice and quote
Once we understand what you need, we explain what we recommend and why, and we give you a clear written quote. You decide whether to proceed.
- 03
Drafting and review
We draft your documents from scratch, tailored to you. We send them to you to read, walk you through anything you want explained and adjust anything that is not quite right.
- 04
Signing and storage
We guide you through the signing process, which has to be done correctly for the document to be valid. Secure storage is offered, so the original is never lost.
Coming soon
Inheritance Tax estimator.
A guided estimator is on the way. It will walk you through the nil-rate band, residence nil-rate band and main reliefs to give you a ballpark figure for what an estate of your shape would owe. Until it lands, the free consultation covers the same ground in a conversation.
Common questions.
An individual has a nil-rate band of £325,000. A residence nil-rate band of up to £175,000 may apply where a main residence is left to direct descendants. Married couples and civil partners can transfer unused allowances, so a couple can often pass on up to £1 million between them without IHT, depending on their circumstances.
Gifts made more than seven years before death generally fall outside the estate for IHT. Gifts made within seven years are 'potentially exempt transfers' and may be subject to IHT, with taper relief reducing the rate as the seven years progress. The rule is simpler in principle than in practice; we explain how it works for your gifts.
Yes, but the rules matter. Outright gifts are potentially exempt transfers, subject to the seven-year rule. Annual exemptions allow £3,000 of gifts each tax year without IHT impact. Gifts out of normal income, properly evidenced, can be exempt without any limit. Gifts that retain a benefit (continuing to live in the gifted property, for example) are usually treated as still in your estate.
No, but charitable legacies can be very efficient. Gifts to UK charities are exempt from IHT, and where 10% or more of the net estate is left to charity, the rate of IHT on the rest of the estate falls from 40% to 36%. For some estates, a charitable legacy of 10% costs the family very little once the reduced rate is applied.
Sometimes, but rarely as a simple solution. Most arrangements that leave you living in the property after gifting it run into 'gift with reservation of benefit' rules, which keep the property in your estate. Where lifetime gifts of property are appropriate, the structures are more careful than the schemes sometimes promoted. We are honest about what works and what does not.
It can, significantly. Business Property Relief can reduce the IHT on qualifying business assets to 0% or 50% depending on the type of asset. Agricultural Property Relief applies to qualifying agricultural property. Both reliefs are detailed and worth getting right. Business succession planning sits alongside this work.
“Most clients are not trying to dodge tax. They are trying to make sure that what they have built reaches the people they meant it to.”
What clients often need alongside this.
Will writing
A properly drafted Will makes your wishes clear, protects the people you love and saves your family from unnecessary stress. Single Wills, Mirror Wills, Complex Wills.
Read moreTrusts
Trusts can protect assets for vulnerable beneficiaries, ring-fence money for grandchildren, reduce IHT exposure or keep wealth in the family across generations.
Read moreBusiness succession planning
Owning a business changes how you plan. We help business owners protect what they have built and prepare for what happens next.
Read more
A free consultation is the easiest place to start.
Thirty minutes with a qualified consultant, no obligation, with a clear sense of your options at the end.
Or call us on 01304 577 998