Facts about Inheritance Tax

Following a person’s death, Inheritance Tax has been known to cost family members thousands and it’s important to get clued up on the unavoidable charges you or your family may be faced with. As it stands, Inheritance Tax will be paid if an estate is worth more than £325,000 and it’s been estimated that this year’s tax bill for British families will top £4bn – so, how does this affect you?

  • You may not be aware of the value of your estate – the value of property, particularly in London and the south east, has dramatically increased in recent years. Along with the rest of your assets you could be worth more than you think, which then means more Inheritance Tax will be required.
  • Keep an eye on the deadline – Inheritance Tax is paid by the deceased’s executor or administrator usually within six months of a person’s death.  After the six month period has lapsed you will begin to pay interest on the estate.  It is also acceptable to pay inheritance tax by instalments but interest charges will apply.
  • Inheritance Tax exemptions – for those who are married or in a civil partnership, your spouse will be exempt from paying Inheritance Tax. However, anything that is left to your spouse following your death will then increase the value of their estate, meaning they may incur the cost upon their death.
  • Reducing your tax bill by making a gift – there are various ways in which you can make gifts during your lifetime in order to reduce your Inheritance Tax.  Gifts must be considered as unconditional and it’s advised you get legal advice before you start giving your money away.

At Forbes Solicitors, we have a specialist team of Inheritance Tax lawyers who are on hand to give you guidance on how to arrange your financial affairs. It’s never too early to start thinking about where your money will go once you’re gone, so send us an email or get in touch with one of our team by calling Freephone 0800 975 2643.

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