A significant proportion of the population, prefer to live together but not get married. For them there is no spouse or single partner exemption.
If one of the partners had a large pension and died, the remaining partner is likely to get NO pension at all.
The recent changes to the Intestacy laws confirm the harshness of the law, if you do not have a will you will inherit nothing.
It may be possible to make a claim for financial dependency but this has to be proved :- ref The Inheritance (Provision for Family Dependents) Act 1975.
If one half of a married couple were to die, then that partner’s assets can be transferred IHT free to their spouse, even if those assets were worth say £1M.
For an unmarried couple, only the nil rate band of £325,000 would be passed IHT free. So even there was a will in place, the transfer of any remaining assets would be taxed at 40%. On a £1m estate the tax deduction would be £270,000.
There have been some very sad and unfortunate instances, after a partner dying, and their partner and children being thrown out onto the street, because the related family were not happy with the relationship.
If this is you, contact us now.
The majority of people give more thought and time to planning their annual holiday than on considering how best to manage their personal affairs, this is particularly true with regard to time and consideration on how their Wills should be drafted.
One is legally allowed to arrange one’s financial affairs so that one pays the minimum of tax. We have always advocated that clients look first at government approved avoidance schemes, such as ISA’s, Pensions, Enterprise Investment Schemes & Venture Capital Trust investments.
Lasting Powers of Attorney
Thinking and talking about what would happen if our faculties deserted us is uncomfortable. That is why it is important to consider Lasting Powers of Attorney. Imagine how much worse the situation would be for your family if you had a stroke, serious accident or dementia without making appropriate arrangements.
Residential Nil-Rate Band
The Residential Nil Rate Band Under the current Inheritance Tax regime, on death the first £325,000 of each individual’s net estate is taxed at 0%. This is known as the “nil-rate band” (“NRB”). Unless any tax reliefs apply, the rest of their net estate is then taxed at 40%.
Inheritance Tax Planning
£4.7 Bn of Inheritance Tax payments were collected by HMRC in tax year 2015 -16 , that’s a record amount of money from inheritance tax, mostly because of rising house prices.