Inheritance Tax: Unlocking Secrets to Save Your Family's Wealth
In the wake of a recent 'terrible Budget', an estate planning expert has revealed some eye-opening strategies to reduce your inheritance tax bill. But here's where it gets controversial: did you know you can pay zero per cent tax on assets worth up to £1 million?
Steve Bish, an esteemed inheritance tax specialist, has shared his insights exclusively with GB News. He urges individuals to take advantage of the allowances within the tax code, especially in light of the recent budget news he describes as 'terrible'.
Mr. Bish, the founder of Steve Bish Estate Planning in St. Albans, emphasizes the importance of 'maximizing' current allowances. One such allowance includes children being able to claim £650,000 tax-free from both parents, a provision that many might overlook.
His timely advice comes ahead of the release of his new book, 'Where There's A Will, There's A Way', which promises to guide readers through the complex world of estate planning.
Mr. Bish sheds light on the often-misunderstood concept of spousal exemption. "Married couples or civil partners need not worry about inheritance tax when passing on their estate to the surviving partner. It's the next generation that shoulders this burden," he explains.
He continues, "Children used to pay 40% on everything over the £325,000 nil rate band, but now they can claim both parents' allowance, bringing it up to £650,000. This is a significant advantage that many families might not be aware of."
And this is the part most people miss: as long as houses are left to direct descendants, children or grandchildren can claim an additional £175,000 inheritance tax-free per property resident. "If they fill in the right forms and make all the claims, it's a million pounds before children of a couple actually pay anything," Mr. Bish reveals.
However, he cautions, "With today's sky-high house prices, it's easy to exceed this threshold."
The award-winning advisor also recommends maximizing the gifting allowance during one's lifetime. "A great way to limit inheritance tax liability for beneficiaries is to make the most of your 'annual exemption'. You can give away a total of £3,000 worth of gifts each tax year without them being added to the value of your estate," he suggests.
For those with larger estates, there are additional strategies. "Each tax year, you can also give away some money or possessions free of Inheritance Tax, known as the normal expenditure out of income exemption. The amount that's tax-free depends on your income level and the allowances you use, as you must maintain your usual standard of living," Mr. Bish explains.
He further advises, "If you have a substantial estate and are inclined to do so, giving 10% to charity can reduce the inheritance tax rate from 40% to 36%."
But Mr. Bish emphasizes that estate planning is just the beginning. "My best advice is to seek guidance from a qualified financial planner. There are other tools like business property relief bonds and loan trusts that can further optimize your estate and ensure your loved ones receive the maximum benefit."
Inspired by the untimely death of his friend Carl 25 years ago, Mr. Bish has penned a comprehensive guide, 'Where There's A Will, There's A Way'. It offers practical advice on probate, inheritance tax, safeguarding children, pets, digital assets, and more, all in plain English, free of jargon.
As Mr. Bish says, "I want to help people avoid the stress and burden that Carl's family went through. My guide is designed to make life easier for those left behind."
'Where There's A Will, There's A Way' will be available soon. For more information, visit www.sbishestateplanning.co.uk.
So, what do you think? Are these strategies a game-changer for your estate planning? We'd love to hear your thoughts in the comments below!
