Expert Guidance on Inheritance Tax Planning
At Dunedin Financial, we help you navigate the complexities of Inheritance Tax (IHT) - ensuring your estate is structured efficiently to reduce tax liabilities for your loved ones.
They say life’s only certainties are death and taxes, and nowhere is that more evident than in Inheritance Tax planning. While most people aim to minimise tax during their lifetime, it’s just as important to consider the tax implications for your estate.
GET IN TOUCHWhat Is Inheritance Tax?
Your estate, including property, money, and possessions - may be subject to Inheritance Tax if its total value exceeds the £325,000 threshold. Given the rise in property values, more people are finding that IHT affects them than ever before.
Can You Reduce Your Inheritance Tax?
Yes! With strategic planning, you can legally lower your tax liability and ease the financial burden on those you leave behind.
Who Pays Inheritance Tax?
Typically, you won’t need to pay Inheritance Tax if:
- Your estate is valued below £325,000 (the standard Nil Rate Band), or
- You leave everything to your spouse, civil partner, a charity, or an eligible community sports club.
For married couples and civil partners, any unused portion of the £325,000 threshold can be transferred to the surviving partner - potentially raising the total exemption to £650,000.
In addition, if you leave your main residence (or a share of it) to your children or grandchildren, your estate may also qualify for the Residence Nil Rate Band (RNRB). This provides an extra £175,000 tax-free allowance per person (frozen until April 2028), which can also be transferred between spouses or civil partners. This means a couple could potentially pass on up to £1 million tax-free, provided the estate includes a qualifying residence and is left to direct descendants.
However, the RNRB begins to taper for estates worth more than £2 million, reducing by £1 for every £2 over that threshold. So, estates above £2.35 million may not benefit from the RNRB at all.
What Is the Current Inheritance Tax Rate?
The standard Inheritance Tax rate is 40%, which applies only to the portion of your estate that exceeds the £325,000 threshold.
How Dunedin Financial Can Help
Inheritance Tax is complex, but with careful planning, you can ensure your estate is passed on efficiently - minimising taxes and reducing stress for your loved ones.
Our expert advisers provide tailored solutions to help you secure a more tax-efficient future.
Contact us today to explore your options and get expert advice on Inheritance Tax planning.