Inheritance Tax Exemptions

Many people each year quite legally use the inheritance tax exemptions to avoid paying tax.

The inheritance tax law in the UK is very complex, and it pays to consult with a properly qualified financial adviser and/or a solicitor before taking any action.

However, the following inheritance tax exemptions mean that tax can be completely avoided in many cases.

• Any transfers between UK domiciled spouses (otherwise up to £55,000, if the spouse is not domiciled in the UK);
• Transfers to UK Charities and political parties;
• Small gifts of up to £250 per tax year. You may give £250 to as many people as you like each tax year;
• The first £3000 of any other gifts per tax year (or £6000 if no gifts were made in the previous tax year);
• Certain gifts on consideration of marriage;
• Gifts out of taxed income - this has already had tax paid on it. However, you must justify that you can maintain your current standard of living;

The use of these inheritance tax exemptions can reduce greatly the amount of tax that will be paid.

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If you would like advice on the inheritance tax exemptions, please contact us.