|
What
About InheritanceTax (IHT)?
written by Maria Davies
www.WomenInPropertyInvestment.com
|
Please
be sure to take legal and accountancy advice on any tax issues,
particularly those concerning inheritance tax. The purpose
of this article is just to make you aware of some options
and the questions you should be asking.
|
|
Even
though you've paid taxes on the money you used to buy assets
during your lifetime, the government currently still want
a massive 40% of anything over the nil-rate band when you
die. This
nil-rate band is set by the government from time to time.
For 2006/07 the IHT allowance is £288K per person.
There
is, however, spouse exemption, so if you leave all to your
spouse, he or she will pay no IHT. Unfortunately, if you
do this, you waste your personal IHT allowance as it dies
with you.
There
are some steps you can take to reduce or eradicate the inheritance
tax bill you leave for your loved ones:
-
if
you're in this position, ask your solicitor about organising
a "discretionary trust" which means that, although your
spouse is able to continue just the same as if everything
had passed to him/her, when he/she dies, the amount of
your IHT allowance effectively goes back into your allowance
pot so the IHT allowance is doubled, saving over £100K
in IHT instantly
-
there
will be no IHT on anything gifted to someone provided
you survive for a minimum of 7 years after the gifting
and provided this is completely given with no ties and
no option for retraction
-
there
is no IHT on charitable donations, so you could scupper
the government by leaving everything over and above your
IHT allowance to the cats' home!
Be
aware that if you want to leave your half of a jointly owned
property to someone other than your spouse, it's not enough
to just make a will, you need to ensure that the property
is owned as "tenants in common" rather than "jointly or
severally" as, otherwise, the property will automatically
revert to the survivor rather than to whom you specify in
your will.
Many
married people think that if they fail to make a will, their
entire estate will automatically pass to their spouse when
they die. This is quite incorrect. There are, in fact intestacy
rules (dying without making a will is called "intestate")
that specify how the estate will be split and there are
many sad cases where the surviving spouse was forced to
sell up to pay taxes and sums to other entitled relatives
of the deceased, simply because no will was made.
Take
legal advice and make a will now, it's never too early.
©
Maria Davies, www.WomenInPropertyInvestment.com
This article may be distributed or reproduced in full provided
the above Copyright line is also included in full.
|
Contact
Me
| Read
the Blog |
Discussion Board |
Site Map
Copyright
© Ladders of Success Ltd 2006
Disclaimer: This website is based on personal findings. It does
not constitute financial advice. Any information should be considered
in regard to your own specific circumstances. All recommendations
are followed at your own risk and all your financial decisions should
be as a result of your own research
|
Sign
up here to access your FREE instantly downloadable "30 Secrets
of Successful Negotiations" & receive periodic articles
of interest to you as a property investor
(I promise never to sell or trade your contact information)
Maria's
true story
Advertise
on this site
Articles
Click
titlefor full article
Successfully
Buying at Auction
A
Home Equity Management Plan
The
Home Equity Myth
Avoiding Rental Voids
Before
You Buy-to-Let
Reducing Capital Gains Tax
Reducing
Property Income Tax
What
about Inheritance Tax?
Stamp
Duty Information
SUBMIT
AN ARTICLE
|
|
|
Want
more money to invest in property? Check out this ground floor
opportunity for
massive residual income
|
|
