Inheritance Tax (IHT) may have a greater impact on a family’s wealth than many people appreciate. The Government’s IHT receipts for the tax year 2013-14 amounted to £3.4 billion. This was an increase of 8.6% on the previous year’s receipts (Source: National Statistics, Inheritance Tax statistics). The current IHT nil rate band has been in force since 6th April 2009 and the government will continue to freeze the nil rate band at £325,000 until April 2021. Tax on estates above this level is levied at 40%. It is important, therefore, to understand what measures are available to mitigate any potential IHT liability. Alexander Douglas Limited specializes in estate and IHT planning.

Alexander Douglas Limited develops and implements tailored financial planning strategies for individuals wishing to preserve their family’s wealth. Our comprehensive service is committed to delivering clear, practical and accurately tailored financial advice that help our clients meet their financial objectives. We should also be pleased to liaise with your legal and accountancy advisers where appropriate. Our areas of expertise include:

Gifting strategies
Using appropriate and timely gifting strategies can be particularly effective in reducing a potential IHT liability. However, not all gifts will be accepted by HMRC as being legitimate for IHT planning purposes.  It is therefore essential to obtain the correct advice on gifting strategies.

Trust based solutions
Certain trust arrangements are particularly effectively in passing wealth down the generations free of IHT. However, it is essential to ensure the trusts are correctly prepared and that you are aware of restrictions inherent in trust based solutions. It is therefore essential to obtain the correct advice on trust based solutions.

Pensions
Changes to pensions legislation effective from April 2015 means that pensions may now be used as a particularly effective IHT planning strategy. However, pensions must be correctly structured to prove effective in this regard. It is therefore essential to obtain the correct advice on pension based IHT panning strategies. 

Insurance based solutions
Insurance solutions may be used both in support of gifting strategies and in providing the money to pay an IHT liability. However, unless correctly arranged they may fail to be effective and could add to the potential liability.  It is therefore essential to obtain the correct advice on insurance based solutions.