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Inheritance Tax Guide
Securing your wealth for future generations
In this guide:
- Inheritance tax: the facts
- Starting your journey
- How to protect inheritance from taxes
At The Private Office, our advice proposition and service delivery is built around the relationships we develop with our clients, and part of that relationship is understanding the positive and negative impact of wealth. Never is this truer than when considering legacy and succession planning.
Please note that the Financial Conduct Authority (FCA) do not regulate cash flow planning, estate planning, tax and trust advice.
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From this guide:
Inheritance tax, or IHT, is the tax levied on assets received by gift or inheritance.
Inheritance tax is a one-off tax paid on the value of an estate (i.e. your assets) over £325,000, the current ‘nil-rate band’. The Net estate, after deducting exemptions, reliefs and nil-rate band is taxed at 40% (or 36%, if 10% or more of your net estate is left to charity).
Example: If your individual estate is valued at £950,000, an individual benefactor would pay an inheritance tax bill of £250,000.
£950,000 – the nil-rate band (£325,000) = £625,000.
40% x £625,000 = £250,000.
The tax must be paid within six months of the end of the month in which the benefactor has died. Your estate includes your business*, ownership or shares, and, if you are a UK domicile, assets you own overseas.
Regardless of your domicile or residence, your estate may be liable to UK IHT on your UK assets. Inheritance tax is regarded as a ‘cumulative tax’ as earlier gifts may be taken into account when assessing how much tax is due. The tax is calculated after all of your outstanding debts are paid, including your mortgage.
*Some business assets and shares may qualify for business relief (see page 12 of the guide for more detail).
Download the full guide to read more.
Our clients speak for us
Meet our expert team
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Daniel Lea
Senior Financial Adviser - Chartered Financial Planner, APFS
Daniel helps clients with their financial needs and advises on various aspects of financial, investment, and retirement planning. He adopts a friendly, straightforward approach towards his work, aiming to empower his clients with informed decision-making.
Abby Ivison
Financial Adviser - Chartered Financial Planner, APFS
As a Chartered Financial Planner, Abby offers insight to guide clients with their financial needs. She is passionate about providing friendly, sound, and honest advice in a way that’s easy to understand so that her clients can feel empowered to achieve their financial goals.
Alex Shields
Partner - Chartered Financial Planner, FPFS
Alex looks to build up a detailed understanding of his clients’ situations which enables him to provide advice tailored to their circumstances. He believes that it’s crucial to communicate in a clear and straightforward manner to put his clients’ minds at ease.