Alternative solutions
Inheritance tax (IHT), once aimed solely at the richest members of
society, now blights middle-income families across the country.
IHT Allowance
Married couples and civil partners now enjoy a combined IHT
allowance of £600,000 rising to £700,000 by 2010. The individual IHT
allowance currently stands at £300,000 and is set to rise to
£350,000 by 2010.
Gifts
Everyone can make gifts of up to £3,000 a year, and these will be exempt from IHT when you die. If you do not use it one year, you can roll it over to the next – for one year only.
You can also make small gifts of up to £250 to any number of people – more if it does not affect the donor’s normal standard of living.
At present, you can make a gift of any value in addition to your annual allowance and it will be free from IHT as long as you live for another seven years.
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Unquoted shares
Some unquoted shares, including those listed on the Alternative Investment Market (AIM) and Ofex, become exempt from IHT once you have owned them for two years.
Farmland
Farmland falls outside the value of your estate for IHT purposes once you have owned it for a certain period. If you farm the land yourself, it will qualify after two years. If you let the land to a farmer, it will qualify for the relief after seven years.
If you require any further information, please email or contact us.
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