When you have worked hard all your life to create a future you always dreamed of for you and your loved ones, it's important to know that you will still be able to provide for your family after you are gone. Inheritance tax and estate planning allows you to ensure your family will continue to benefit from your wealth by structuring your financial affairs in the most tax efficient manner thus allowing you to pass on as much as possible.
The idea of working your whole life and then having to pass a large chunk of your wealth to the tax man can leave a bitter taste in many people’s mouths. However, there are ways to minimise or even eradicate any such liability and ensure that your life’s wealth goes to the people you want it to.
Inheritance tax planning isn’t a subject most of us care to think about, but getting the right advice is imperative to make sure your wealth is passed to the ones you love efficiently and quickly.
HMRC is a powerful force and has access to up to 7 years of your financial matters, in order to identify any activity that could be liable for inheritance tax. They can look into any schemes or gifts that you have organised to see if you had continued to benefit from assets that you had declared to have passed on. Without clear planning and documentation, your beneficiaries could face a long drawn out investigation at the worst possible time.
While making a gift from your estate may sound simple, you must seek professional advice in order to ensure that it has a positive impact on your inheritance tax liabilities. An IHT liability is measured on various factors, such as how long ago the gift was made, who it was made to and for what reason. You need to ensure that you have managed your money and estate correctly. It is important to understand that by making a gift, you are no longer entitled to benefit from that particular asset.
The short answer is yes. Even if you are an international worker living overseas, if you still hold ownership on any property within your home nation, you could find that your entire estate is liable for local inheritance tax. This is down to legal definitions and how this affects your inheritance tax liability. It all boils down to whether your status in another country is regarded as residence or domicile. Acquiring a new domicile is difficult. You need to be able to show that you never intend to return and once you have made this choice, it is still best practice to seek professional help!
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Perhaps the most precious gift you can give your loved ones is time both when you are here, and after you pass away. At Skybound it’s our mission to allow you to do just that by taking care of your financial planning both now and for generations to come.
You can reach us directly by calling us between the hours of 8:30am and 5pm at each of our respective offices and we will immediately assist you.