Skip navigation

INHERITANCE TAX

Anyone living in their own home in west London, and particularly in Hammersmith, is almost certain to have assets with a value higher than the threshold for inheritance tax which is currently £325,000. Amounts over the threshold passing to non-exempt beneficiaries such as children, grandchildren and friends are liable for inheritance tax at 40 per cent.

In 2015 the Conservative government announced proposals to increase the threshold for inheritance tax. In 2017 the Conservative government introduced the residence nil rate band (RNRB) specifically for property owners who pass their residence to direct descendants. This new residence nil rate band (RNRB) is being introduced in stages starting with an initial £100,000 from April 2017 after which it increases to £125,000 from 6th April 2018; to £150,000 from 6th April 2019; and to £175,000 from 6th April 2020. There is no change to the inheritance tax threshold for people who do not leave a residence or who leave their residence to people who are not direct descendants or whose net estate exceeds £2.2m.

The solution is to find ways of reducing your inheritance tax liability. This is best done before your death but it can also be done afterwards. Click on the options at right or scroll down:

Minimising inheritance tax: before death[ TOP ]

This can be done through your will, by making allowable gifts and by planning the way your estate is distributed. It is possible to reduce the potential inheritance tax bill further through lifetime giving. These are complex issues which require you to consider all the options and their implications.

We advise you to take legal advice on what is best for you so you can be sure you have explored all the options.

What you should do

  • Make a list of your assets and their values (properties, shares, savings, investments, life assurance policies, endowment policies, pensions which pay lump sums on death, premium bonds, car, cash and anything else of value that will be counted as part of your estate).
  • Make a list of your liabilities and their values (mortgages, loans and debts).

This, with other information we will ask you about when we meet, will enable us to calculate your likely inheritance tax liability and advise you on the best way to minimise it.

Solicitor Chiswick, West London: Wills, Probate, Inheritance Tax, Conveyancing

Minimising inheritance tax: after death[ TOP ]

Although we would never advise anyone not to worry about their inheritance tax liability before they die, under current tax laws there are ways of reducing an estate's liability after someone has died.

In many cases it is possible for a deed of variation to be drawn up changing the will to make it more tax efficient. This must be done within two years of the death.

If you are an executor or beneficiary to a will which you believe could be restructured to reduce the inheritance tax due, please contact us.

Solicitor Chiswick, West London: Wills, Probate, Inheritance Tax, Conveyancing [ TOP ]