Even if your estate is not likely to be subject to Inheritance Tax, you should consider the position of your children and other beneficiaries and what you may inherit from your own parents.
There are a number of gift allowances and tax reliefs to take into account including:
- Nil rate band allowance. This is the first part of the value of your estate or gift that is not subject to IHT. It is currently £325,000 per person. For married couples or civil partners, if all or part of the nil rate band is unused on the first death, it transfers to the surviving spouse or partner and is added to the survivor’s nil rate band providing a total £650,000 allowance.
- Residence nil rate band allowance. This is an additional allowance currently worth £175,000 which is transferrable between spouses and civil partners
- Annual gift exemption – currently £3,000
- Small gift allowance – currently £250
- Gifts in consideration of marriage
- Regular gifts out of excess income after normal expenditure
- Gifts to charity
- Business and agricultural property relief
For help and advice with all aspects of estate planning, please contact us.