01582 461588
01635 521444
Harpenden:   Newbury:
01582 461588   01635 521444
Independent Financial Advisers and Investment Managers
IHT / Trusts

Inheritance Tax (IHT)

On death, the estates of UK domiciled individuals are assessed to Inheritance Tax.  In some circumstances, IHT can be assessed during one’s lifetime too.

On death, transfers between spouses or civil partners are exempt so, if there is going to be an IHT liability, it is more likely to arise on the second death - when assets must, by definition, pass to beneficiaries other than your spouse or civil partner.  

Currently, each individual benefits from an IHT nil-rate band of £325,000 which means this, or a lesser amount, can pass from the estate of the first to die to the next generation without tax being payable.  In the case of a married couple or a couple in a civil partnership, if the first to die does not use (or has not used) all of his or her nil rate band, any unused part can be transferred to the survivor.  This means that, on the second death, the estate could benefit from up to two nil rate bands totalling £650,000.   

Any amount that exceeds the available nil rate band is taxed at 40%.  Many couples, especially in south-east England, have combined estates that exceed £650,000 resulting in a potential IHT liability at some point in the future. 

Planning ahead can minimise or even completely mitigate the negative impact that IHT can have on the legacies that your heirs will receive.  Remember, the assets that you own have almost certainly been accumulated from income that was taxed as it was earned.

If you would like to consider ways of reducing or mitigating your estate’s future IHT liability why not contact us for a free, without obligation, discussion.    


The use of trusts is often an integral part of Inheritance Tax (IHT) planning.  Indeed, our IHT planning service will often include a recommendation that one, or more, trust is created either now or upon death.  In these circumstances we offer guidance on what type of trust should be used, what trust wording would be appropriate, who the trustees should be etc. 

The taxation of trusts can be complex, and so we routinely explain how the recommended type of trust would be assessed from an Income Tax, Capital Gains Tax and IHT perspective.

We also offer a technical and investment advice service for trustees of existing trusts that have been created during someone’s lifetime or under the terms of a deceased’s Will.  With this area of advice, we regularly liaise with clients’ solicitors or other professional advisers.

Please do not hesitate to contact us if you feel that we may be able to be of assistance.

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