Our resident money saving and IHT expert IFA Jason Witcombe answers your questions on inheritance tax.
Inheritance Tax Planning: Minimise your inheritance tax bill
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Your Money Question on Inheritance Tax:
Are there any plans for the government to reduce inheritance tax charges? How can I minimise the amount of inheritance tax I will have to pay on my mother’s property when she dies? I don’t want to have to sell the family home in order to pay the tax.
Inheritance Tax Answer from Money Expert Jason Witcombe:
The inheritance tax threshold (nil rate band) is due to increase to £350,000 in April 2010. After that we may have a new Government in the shape of the Conservatives. They have talked about increasing the threshold to £1 million but who knows when that will happen, if at all. Remember, also, that the nil rate band is now transferrable between spouses so if your father’s nil rate band (NRB) wasn’t used, this may also be available on top of your mother’s allowance.
Inheritance tax planning is particularly complex. There is a section on our website dedicated to how it can be mitigated but the reality is that there is no “one size fits all” solution and of all areas of personal finance, this is one I would strongly recommend you don’t take a DIY approach to. Speak to a fee based Independent Financial Adviser.