Reply to: Inheritance Tax - What have you done to avoid it?

[Ardesco]

I have a foolproof plan to beat inheritance tax....


NEVER DIE!!!!

Working hard on not dying right now and so far all is going surprisingly well

[ASB]

24% is exempt through being in a pension, and another 52% is exempt because it would go to the wife under the rules of intestacy. (I believe money left to wife does not count for inheritance tax purposes.)

I'm slightly confused by the last bit of that. Whilst assets which go to a spouse are exempt this means (at least meant before the changes) that all that would effectively happen is that it would still be part of her estate on her death (unless she'd spent it). Thus the only impact was to effectively defer the tax until the second death.

[IR35 Avoider]

Just done a calculation, for myself alone and 300K limit. I think only 24% of my net worth would be potentially subject to inheritance tax, and that takes me well below 300K

24% is exempt through being in a pension, and another 52% is exempt because it would go to the wife under the rules of intestacy. (I believe money left to wife does not count for inheritance tax purposes.)

The bit that is potentially caught would go to my parents and brother and sister, but as I said, is well below the limit.

Edit: this link shows how the taxable amount is much smaller than the estate, if you're married. Note that the limits are well out-of-date. These days I believe the spouse gets the first 200K plus half the rest. The tax-free amount is also much higher.

http://www.thisismoney.co.uk/help-an...2&in_a_source=

[IR35 Avoider]

I think it's now a 600K limit between two, if you're married.

Firstly, money that's inside a pension scheme should be safe. If you've notified the pension who you would like your pot to go to, but it's at their discretion, that means it will be outside your estate for inheritance tax.

Currently the wife and I are over the limit even after deducting pensions, but not by much.

I intend to spend the money by buying an annuity. No matter how much money you have, you can eliminate it from your estate overnight by doing this, while continuing to benefit from it by getting an income for the rest of your life. The only problem with this strategy is that your income may force you to spend more than you're comfortable with in order to ensure capital doesn't accumulate again. I think this as a challenge most of use would rise to though.

[Diver]

Trusts

(Trust that I can squirrel enough away in untraceable assets that I can transfer them to the family without them paying a penny in Tax )

[NickFitz]

I seeked expert advice

sought

HTH.

[Heavenlyz]

Become immortal

[BrilloPad]

I got divorced so am now worthless.

[Sockpuppet]

The zero band for IHT is £300K and that includes all your property, cars, possesions, savings etc. I would have thought most here have assets way above this level.

See poll.

I'm leaving all my possessions to TPD.

Kind of like when a crazy women leaves money to her cats.

[DiscoStu]

I'll be dead. I don't care.

[ratewhore]

Blow the lot and let the kids look after themselves. It's character building apparently...

[Clippy]

My plans involve taking a cruise down the Thames in my new canoe...

[AlfredJPruffock]

Now my Advice for those who Die

Declare the Pennies on your eyes !

Cos Im the Taxman

Yeah - Im the Taxman

And youre working for no-one but me .....

[gingerjedi]

I thought the IHT threshold was doubled or hasn't it happened yet? ...or is that it??

[tay]

Good point.

I forgot everyone in the UK is a non-dom these days and pays no tax, apart from one or two poor bastards who were stupid enough to be born here.

Not your fault you were born here... so turn that frown upside down!

It is your fault if you die here though... move to a country that has a modern tax system not a hangover from 200 years ago.