Are trusts tax efficient?

A trust can be a great way to cut down your IHT bill. Our expert advisors can guide you through the process.

Are my heirs subject to any other taxes?

Your heirs may be subjected to Income Tax, Capital Gains Tax and may also get their benefits affected if they have more than £6000 after inheritance.

How am I going to afford long-term care?

Finawis Advisors can help you plan your long-term care and funding you may need to support your later years.

Is Estate Planning same as Will Planning?

Will Planning is a simple process of documenting your wishes and what happens to your assets in the event of your death. Estate Planning is a more comprehensive process incorporating various documents pertaining to securing and passing of your assets in the most tax efficient way.

How much can I give as gifts each year?

Annual exemption: You can give away a total of £3,000 worth of gifts each tax year without them being added to the value of your estate. This is known as your ‘annual exemption’. Small gift allowance: You can give as many gifts of up to £250 per person as you want each tax year, as long as you have not used another allowance on the same person. Birthday or Christmas gifts you give from your regular income are exempt from Inheritance Tax. Gifts for weddings or civil partnerships: Each tax year, you can give a tax free gift to someone who is getting married or starting a civil partnership. You can give up to: £5,000 to a child £2,500 to a grandchild or great-grandchild £1,000 to any other person Regular payments/Excess Income Gifting: You can make regular payments to another person, for example to help with their living costs. There’s no limit to how much you can give tax free, as long as: you can afford the payments after meeting your usual living costs you pay from your regular monthly income These are known as ‘normal expenditure out of income’. They can include: paying rent for your child, paying into a savings account for a child under 18, giving financial support to an elderly relative If you’re giving gifts to the same person, you can combine ‘normal expenditure out of income’ with any other allowance, except for the small gift allowance.

Can a life insurance policy cover my Inheritance Tax Bill?

Yes, life insurance policy can cover a part of or your full IHT bill before Probate is granted. It can protect your assets from being sold to pay IHT making things easier for your family. It required special planning. To know more, please contact us.

I have a Will, do I need Estate Planning?

Wills and Estate Planning are often used interchangeably but it’s important to recognize they don’t mean the same thing. Our Estate Planner will work with you to estimate your potential inheritance tax obligations and provide you with tailored advice.

Can I write my own Will?

Yes, you can write your own Will. It should be only done when your wishes are simple like leaving everything to partner. However, you must seek professional advise if you are trying to reduce your Inheritance Tax bill, or own a property abroad, or have foreign investments or bank accounts, or you have people financially dependent on you.

How can I store the Will safely?

Never store your Will in a bank safe deposit neither bank can access it nor can your executer until Probate is granted, and Probate cannot be granted in the absence of Will. We strongly advise that once the Will is made, it should not be kept in home environment as it can get damaged due to theft or loss. You can take advantage of our Secure Storage Facility for a small annual fee. You can access your documents free of charge at any time, upon written request and surrender of your Storage Certificate. We can advise you other options as well. Once you have decided how to store the Will, we recommend informing your executor about its storage and how to access it.

How do I store LPAs safely?

Powers of Attorney are powerful documents. We strongly advise that once the Powers have been signed and registered, you do not keep these legal documents in the home environment, for the following reasons: Storing your documents will ensure that these Powers are NEVER used without your express knowledge and consent, while you have capacity. Prevent your documents from being accidentally damaged or destroyed. Ensure that your documents are never lost or stolen. You can take advantage of our Secure Storage Facility for a small annual fee. You can access your documents free of charge at any time, upon written request.

EstatePlanning

Pensions – Protected from taxes? Think again!

ByPavan Nagori March 19, 2024March 19, 2024

Yes, pension contributions are deducted from taxable income
Yes, investments in a pension grow free from income and capital gains tax

Do you have rental or other income? Are you likely to use all your pension in your lifetime?

NO, The good news is that there no Inheritance tax on pensions. Hence, you should use your assets before dipping into your pension.

HOWEVER, if you die after 75 years of age as most of us will, the pensions are taxed as INCOME TAX in hands of beneficiaries in that year. So you saved 40% tax, children pay 45% tax!

Solution: Make sure your pension is in a provider that supports a flexible drawdown option. Most company pensions do not.

Need help? Call me to discuss your options and overall inheritance planning.

HMRC investigates families for IHT shortfalls

HMRC opened 2,029 investigations between April and November alone, recovering £172 million. This is part of a larger trend – with over 3,100 investigations and £251 million recovered in the previous tax year. The Times said that the Treasury is expected to raise £7.6 billion from inheritance tax in 2023-24, an increase of £500 million…

Probate Delays continue

New data from HM Courts & Tribunals Service (HMCTS) has revealed Probate application delays continue. For the 27,664 grants of probate issued in October, the average timeline from submission to grant was 15.2 weeks (September was 15.4) according to the data. This is still an increase from the 13.9 weeks recorded in June this year…

Institute for Fiscal Studies has suggested restricting relief from inheritance tax (IHT) to raise revenues and make the tax ‘fairer’. 😒

The IFS suggests targeting: Imagine the impact to your business if existing IHT reliefs for owners of small UK businesses! How will the beneficiaries pay IHT? Sell the business assets and stop operating the company? This will have a major impact on the UK economy. This will increase the urgency for inheritance planning and potentially…

Probate applications on the rise…. as the court battles with backlog

The number of probate applications are increasing with data showing a 3 per cent rise each year since 2020, analysis by Final Duties has revealed. Jack Gill said: “The thing that catches most people out is the complexity of the probate process. It is a long, arduous journey full of pitfalls which, if fallen foul of, can…

Banks need to catch up with the world

The population is aging and Dementia/Alzheimer’s is on the rise. People are getting ready for it by executing Lasting Power of Attorney and appointing their trusted friends/family to make decisions on their behalf if they are no longer able to make them. However the banks are not equipped to handle these requests. As reported by…

Pensions – Protected from taxes? Think again!

Do you have rental or other income? Are you likely to use all your pension in your lifetime?

NO, The good news is that there no Inheritance tax on pensions. Hence, you should use your assets before dipping into your pension.

HOWEVER, if you die after 75 years of age as most of us will, the pensions are taxed as INCOME TAX in hands of beneficiaries in that year. So you saved 40% tax, children pay 45% tax!

Solution: Make sure your pension is in a provider that supports a flexible drawdown option. Most company pensions do not.

Need help? Call me to discuss your options and overall inheritance planning.

HMRC investigates families for IHT shortfalls

Probate Delays continue

Institute for Fiscal Studies has suggested restricting relief from inheritance tax (IHT) to raise revenues and make the tax ‘fairer’. 😒

Probate applications on the rise…. as the court battles with backlog

Banks need to catch up with the world

Happy New Year!

PROFESSIONAL AFFILIATIONS

Do you have rental or other income? Are you likely to use all your pension in your lifetime?

NO, The good news is that there no Inheritance tax on pensions. Hence, you should use your assets before dipping into your pension.

HOWEVER, if you die after 75 years of age as most of us will, the pensions are taxed as INCOME TAX in hands of beneficiaries in that year. So you saved 40% tax, children pay 45% tax!

Solution: Make sure your pension is in a provider that supports a flexible drawdown option. Most company pensions do not.

Need help? Call me to discuss your options and overall inheritance planning.

Similar Posts

PROFESSIONAL AFFILIATIONS

Follow us on: