HMRC has revealed that it has seen an increase in the amount of tax paid on death in England and Wales for the period to April 2022. This is up £10million on the same period last year and brings Inheritance Tax receipts for the Chancellor to a whopping £0.5billion. This increase is due to higher volumes of wealth transfers which took place during the pandemic, an increase in asset values and the government's decision to keep the Inheritance Tax thresholds at current limits until 2025/2026 tax year. This continues a trend which has seen the receipts from Inheritance Tax double over the last ten years.
When did you last sit down and work out how much your assets were worth. Take five minutes: total the value of your home, your savings, your investments, your National Savings premium bonds and all the other things you own. Do not include your income, life policies or your pension pots. What is the figure you come up with?
If this total is more than £325,000 if you are single or more than £650,00 if you are married or in a civil partnership, then Inheritance Tax is something you need to be concerned about. If your assets exceed this amount then it is possible that your family, following your death, could be left to work out how to settle an Inheritance Tax bill at 40% of the value in excess of this £325,000 or £650,000. With the majority of the value being tied up in your home finding funds to pay a tax bill may cause an enormous amount of stress and worry for those you leave behind and could cause financial hardship.
The solution to this problem is sensible advice. You need to talk through how inheritance tax planning can help to mitigate the potential tax liability you may have. It can help to structure your estate and your will to ensure you pay as little tax as possible and pass assets to your family in the most effective way.
If you don't want to pay anymore than you have to to HMRC then take some time to thing about what you are worth, what you want and how you can get there, whilst taking some advice from an expert. The Argo team do this every day. We are here to help you and are even nice enough to give you some free time to discuss what you are worried about. Take advantage of our fifteen minute first aid call to find out how we can help you. Call us on 01622 843729 for more information.
