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Inheritance
Tax Planning
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Inheritance Tax
Planning Thresholds and Rates Table
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Figures
are correct up to:
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Tax
Year
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| IHT
Allowance |
| 2000
- 2001 |
234,000 |
| 2001
- 2002 |
242,000 |
| 2002
- 2003 |
250,000 |
| 2003
- 2004 |
255,000 |
| 2004
- 2005 |
263,000 |
| 2005
- 2006 |
275,000 |
| 2006
- 2007 |
285,000 |
| 2007
- 2008 |
300,000 |
| 2008
- 2009 |
312,000 |
| 2009
- 2010 |
325,000 |
| 2010
- 2011 |
325,000 |
| 2011
- 2012 |
325,000 |
| TOP
TIP: This IHT Tax allowances above are
applicable on the death of a single person or the first
spouse or first Civil partner. However, in the case of a
partnership, the surviving second spouse
or second Civil partner can also benefit from a transfer of the first partners
IHT Tax allowance. Effectively this means that for
2011/2012 married couples and registered civil partners will not pay tax on the first £650,000 of their
estate (£325,000 + £325,000). Tax is again then payable at 40% on any amount over
this threshold. It is therefore tax effective for couples to leave everything to each other
before leaving any of their estate to their children. |
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Useful
Capital Gains Tax Advice Websites
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Inheritance Tax
Exemptions
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TIP: Be very careful of not falling into the
'Gifts with reservation' trap. These are gifts that you
make to loved ones which you continue to benefit from.
i.e. The classic example being that of giving your house to your
children while you carry on still living there whilst paying
none or below-market-value rent. These gifts are
still subject to Inheritance tax when you die. Always
seek professional advice before going down this route. |
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Gifts that are exempt
from Inheritance Tax
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Gifts
to you your
husband, wife or civil partner, as long as they have a
permanent home in the UK
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Gifts to a registered charity established in
the EU or another specified country, whether made during the persons
lifetime or as part of their will
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A gift to some national institutions such as
museums, universities or the National Trust
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Gifts
to any
UK political party that has at least two members elected
to the House of Commons or has one elected member but
the party received at least 150,000 votes
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Gifts of up to but not exceeding £250
per year to any number of persons
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Gifts in consideration of marriage or civil partnership of: up to £5,000 by a parent, up to £2,500 by a grandparent, or up to £1,000 by any other
person
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Gifts that are NOT
exempt from Inheritance Tax
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Gifts
that you give to your unmarried partner, or a partner
that you're not in a registered civil partnership with,
are not exempt.
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Inheritance
Tax Calculator For 2011 - 2012
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Click
here to access a Inheritance Tax Calculator for 2011
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Budget
2011 - Inheritance
Tax Changes
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From
April 2012 - There will be a reduced rate of Inheritance Tax of 36% for
any estate leaving a legacy to charity. If 10% or more of the estate is
left to charity, then the government will take 10% off the Inheritance Tax rate. No beneficiaries will be better
off as a result of this change - just the charities.
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Inheritance
Tax Advice Book
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How
to avoid Inheritance Tax
- This book tells you all you need to know about how to
legally shelter your family's money from the
taxman. Taking into account both simple and
complex tax planning strategies, the guide is
essential reading for both parents and grandparents. |
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