Inheritance Tax – One in ten estates will be paying IHT by 2018
The proportion of estates liable for inheritance tax (IHT) will quadruple from just 2.6 per cent in the 2009-10 tax year to 10 per cent in 2018-19, according to research by the Institute for Fiscal Studies. IHT liabilities will then take a bigger share of the national income than at any time in the past 45 years – unless the tax is reformed.
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At DND Law, we understand that inheritance tax (IHT) is a concern for many individuals looking to safeguard their assets for future generations. Recent figures have shown that by 2018, one in ten estates in the UK is expected to be subject to IHT. This rising trend highlights the importance of planning and professional guidance to minimise the impact of this tax on your estate.
Understanding Inheritance Tax
Inheritance tax is levied on the estate of someone who has passed away. The current threshold, or nil-rate band, is £325,000 per individual. For married couples or those in civil partnerships, any unused allowance can be transferred, effectively doubling the threshold to £650,000.
Assets exceeding the threshold are taxed at 40%, a significant percentage that can diminish the wealth you wish to pass on. While some reliefs and exemptions exist, such as gifts to spouses, charities, or agricultural property, many families find themselves within the scope of IHT due to rising property values and accumulated assets.
The Growing Scope of IHT
Data suggests that by 2018, approximately 10% of estates will fall into the IHT bracket. This rise is largely attributed to property price increases, particularly in London and the South East, where even modest homes often exceed the £325,000 threshold. Without proactive planning, families risk losing a substantial portion of their inheritance to taxation.
How DND Law Can Help
At DND Law, we specialise in providing Solicitors Newry tailored solutions to mitigate inheritance tax liabilities. Our expert team can assist with:
- Estate Planning: Structuring your assets effectively to maximise allowances and minimise tax exposure.
- Use of Trusts: Creating trusts to protect and manage your wealth while reducing your IHT liability.
- Lifetime Gifts: Advising on tax-efficient gifting strategies, taking advantage of annual exemptions and the seven-year rule.
- Business and Agricultural Relief: Helping you claim available reliefs for qualifying assets, ensuring you preserve more of your estate.
- Residential Nil-Rate Band (RNRB): Ensuring your estate benefits from this additional allowance when passing on your family home.
Take Control of Your Legacy
Proactive inheritance tax planning is essential to ensure your wealth is preserved for your loved ones. At DND Law, we are committed to providing clear, practical advice tailored to your unique circumstances. Whether you need to draft a will, set up a trust, or explore other estate planning tools, our team is here to guide you every step of the way.
Contact DND Law Today
Don’t leave your estate planning to chance. Speak with one of our inheritance tax specialists to ensure your family’s future is protected. Contact DND Law Newry Divorce solicitors today for a consultation and take the first step towards securing your legacy.
