Currently individuals and their Estates are subject to UK Inheritance tax if they are domiciled or deemed domiciled in the UK, or have UK situs assets.
From 6 April 2025 new legislation will be introduced and inheritance tax will be payable after someone has been in the UK for 10 years and will remain applicable for 10 years after someone has left the UK.
With rising property prices in the UK inheritance tax (IHT) is no longer a tax reserved just for the wealthy. If you have an ‘estate’ with a value which exceeds the UK’s ‘nil rate band’ you could find yourself passing an unwelcome and unnecessary tax liability on with your estate on death. This can leave your family facing the prospect of having to sell assets in order to meet that tax liability.
Our advisers can provide bespoke advice which ensures your personal circumstances and wishes are fully considered, whilst achieving the optimum IHT position during your lifetime and on death.
This will be achieved by conducting a brief wealth review which establishes the value of your individual estate together with that of your partner. We will consider your level of income and spending requirements, family details, previous IHT relevant events and anticipated future events, your approach to risk, current wills and future intentions for your business and personal life.
Non-domiciled Taxpayers
The Non-Dom tax regime is being abolished from 6 April 2025 onwards.
This means that the previously available inheritance tax protections available to non-doms will no longer be available and they will instead be subject to UK inheritance tax rules if they have been resident for 10 or more years from 6 April 2025 onwards.
In particular it is anticipated that “excluded property” inheritance tax protection for trusts will be abolished but exact detail is not yet available.
If these changes are a concern then please contact us for advice.
Following our wealth review our advice may include some or all of the following:
- Working alongside your legal and financial advisers to ensure your will is adequate and meets your personal and IHT planning objectives;
- Ensuring you benefit from all exemptions and reliefs applicable to gifts made during your lifetime;
- For those born outside the UK or who have foreign parents, reviewing your domicile status and advice on the application of the deemed domicile rules, excluded property trusts and restrictions to the spousal exemption;
- Ensuring you benefit from all exemptions and reliefs applicable to gifts made on death;
- Advising you on the use of trusts, where appropriate, to ensure succession and protection of assets and removal of assets from your estate;
- Freezing the value of assets and ensuring increases in value do not suffer IHT;
- Capital gains tax issues arising from lifetime gifts including hold-over or gift reliefs and transfers between spouses, gifts into trust;
- Ensuring business owners qualify for 100% ‘Business Property Relief’ (BPR);
- Restructuring your investment portfolio to invest in assets which are IHT efficient;
- Life assurance and pensions;
- Considering your exposure to the pre-owned assets tax regime.
If you would like one of our advisers to carry out a wealth review and consider your IHT position please contact us.
