Inheritance Tax

The value of your estate is below the £325,000 threshold currently applicable in England

Or you leave everything above the £325,000 threshold to your spouse, civil partner, a charity or a community amateur sports club

However, despite the estate’s value being below the threshold, there are still obligations to report it to HMRC.

If you give away your home to your children (including adopted, foster or stepchildren) or grandchildren your threshold can increase to £500,000.
If you are married or in a civil partnership and your estate is worth less than your threshold, any unused threshold can be added to your partner’s threshold when you die. This means their threshold can be as much as £1 million.
The standard Inheritance Tax rate is currently 40%. For example, if your estate is worth £500,000 and your tax-free threshold is £325,000. The Inheritance Tax charged will be 40% of £175,000 (£500,000 minus £325,000).
The estate can pay Inheritance Tax at a reduced rate of 36% on some assets if you leave 10% or more of the ‘net value’ to charity in your will.
Inheritance tax like many other taxes can involve some tax reliefs and exemptions, depending on individual circumstances. The better you plan for it, the more tax savings you can make and leave cash in the pockets of your beloved beneficiaries.
Our trained tax teams can help you with matters around inheritance taxes. For confidential and personalized advice, please visit us in our London office or get in touch over the phone.