Inheritance Tax (IHT) planning

Not only do you pay tax throughout your lifetime on your earnings; interest on your savings; dividends from your investments; gains made on the sale of your investments; and even on the goods that you buy with your taxed earnings, the Government may also tax you when you die. As a result, H M Revenue and Customs (HMRC) can often end up as a major beneficiary from your estate.

One way of reducing your estate and, therefore, any potential IHT liability is to give away capital whilst you are still alive. This can create problems, however, as giving away capital means that you lose control over the assets. Previously, these problems were overcome by a suitable worded trust, but the Government’s unprecedented attack on trusts in the 2006 Finance Act has forced a radical change of strategies to mitigate IHT. As a result existing trusts need to be reviewed to determine whether any action or change of direction is either necessary or desirable, and Wills should also be reviewed in the light of the changes.

Working in conjunction with our private client colleagues, Littlejohn Wealth Management has developed various ideas to help you mitigte IHT and set up structures that can be used by your children in years to come for their own IHT planning.