“Most families are unaware that they
will have to pay inheritance tax”
INHERITANCE TAX (IHT)
Death duties are reaching record levels with the latest figures detailing that the UK Government alone collected over £5.4 billion/year in IHT in 2018. Whilst Inheritance tax varies around the world, as typical example, in the UK, it is payable on all estates valued at over £325,000 and is charged at 40%. (reduced to 36% if 10% or more is donated to charity).
In practice, most families are unaware that they will have to pay inheritance tax but when they learn the facts they take steps to avoid it.
The worlds highest IHT rate is Japan at an eye watering 55% with the lowest (excluding Nil Rate countries) being Italy at 4%.
If you haven't protected your assets, alarmingly HMRC (Her Majesties Revenue and Customs) will tax the same asset multiple times with their Generational IHT powers. However our intelligent Trust planning stops them dead in their tracks meaning more money for your beneficiaries and not the tax man.
The former British home secretary, Lord Jenkins once said, “IHT is ‘a voluntary tax, paid by those who distrust their heirs more than they dislike the Inland Revenue’ and steps can be taken to minimise liability by using a number of entirely legitimate processes.”
Whilst this specific statement should be taken with a pinch of salt, the fact remains that with the use of intelligent Legacy Planning combined with the use of trusts steps can be taken to legally mitigate IHT liability. In some countries, domestic trusts are common place and relatively cost effective to establish (particularly when you compare the set up costs to the massive potential IHT savings) and in other jurisdictions effective planning can be more complex however in any event, Trust Planning is a specialist area requiring solutions tailored to your own particular situation and it is of vital importance that you proceed with the assistance of an organisation who have access to a team of International Will Writers, Trust Lawyers and Estate Planners have over 100 years of experience and are members of the prestigious UK organisation The Society of Trust & Estate Practitioners (STEP).
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