According to the latest research, more than half of over 50s don’t seek Inheritance Tax (IHT) advice.
The research by Tim Investments indicates that 58 per cent of individuals over 50 who use a financial adviser have not discussed IHT with them.
This follows the news that IHT receipts are set to increase from £5.4 billion last year to £7 billion by 2024, according to the Government’s official forecasts.
IHT bills have risen consistently since the Government froze the nil-rate band at £325,000 in 2010, with more estates being liable for inheritance tax in recent years.
Tim Steele, a Partner with Palmers who specialises in Inheritance Tax planning matters, said: “Estate planning is a key part of ensuring that your legacy is passed on in the most tax-efficient manner.
“The lack of proactive IHT planning mirrors the fact that here in the UK there is an unfortunate tendency to put off thinking about our own mortality.
“A separate recent survey has suggested that as many as 25 million UK workers may not have made a Will which means they are risking their hard earned wealth going to the wrong people or the taxman.”
In England and Wales, every individual is entitled to an IHT-free allowance of £325,000, with anything above this figure attracting IHT at a rate of 40 per cent.
There are ways to mitigate your IHT liability, such as passing property to direct lineal descendants using the residence nil rate band (RNRB) or leaving money to a charity in your Will.
The recent figures highlight the importance of effective inheritance tax planning, particularly with IHT receipts rising.
Preparing a Will that is valid, up-to-date and legally binding is essential to avoid lengthy probate cases, ensuring that your wishes are fulfilled.
Additionally, there are many different tax-free allowances for making gifts, including the annual exemption of £3,000.”
There are also marriage gifts (up to £5,000 for children, £2,500 for grandchildren and £1,000 for anybody else), and small gifts of up to £250 per year if the person has not received another gift that uses an exemption.
For help and advice with matters relating to inheritance tax, please contact us.