Archive for the ‘Estate Planning’ Category

Estate Planning And The Implications Of Poor Planning

Tuesday, June 4th, 2013

One of those areas that the majority of people leave too late is Inheritance Tax Planning which is not surprising when you realise you are being asked to consider your mortality.

However, inheritance tax planning is probably one of the most significant areas when it comes to tax, after all the majority of people have private properties together with all of their other assets to make a size-able estate, and one that could be subject to a large tax bill!

Here’s some interesting articles on estate planning and some of the changes being made …

estate planningIHT planning: Inheritance tax loss on sale reliefs

Inheritance tax (IHT) is always a touchy subject and often ignored. It is difficult enough dealing with an anticipated or even actual loss of a family member, but what happens when it transpires that the loss is reflected financially, too?

If securities or land and houses are sold at a loss to the probate valuation during the course of an estate’s administration, it is possible to substitute those lower gross sale proceeds for the probate valuation – providing the rules set out in sections 178 to 189 of the Inheritance Tax Act 1984 (“the Act”) (for securities) and 190-198 of the Act (for land) are observed. [Original source: here]

Of course we have all seen or heard of celebrities being caught using tax avoidance schemes and whenever something like this hits the headlines all tax planning receives close attention as discussed in this article by Carmen Reichman …

The future of Inheritance Tax Planning

High net worth clients and their professional advisers (the latter ‘morally repugnant’ according to our politicians) might be excused for thinking that the opportunities for taking steps to minimise the impact of a 40% inheritance tax charge on their death – or the death of the survivor in due course, depending on their wills – on estates over a relatively modest threshold of just £325,000 are gone.

With frequent media outbursts about the “unpatriotic” nature of tax planning by the multinationals and the coming into effect of the new GAAR (general anti abuse rules) later this year, should we not all just sit back and let the taxman take whatever he thinks appropriate? [Original source: here]

Property owners or landlords are probably the most at risk when it comes to estate planning and they certainly need to plan carefully if they want to pass on their estate at some time in the future. Here are 10 tips for landlords …

Landlords Advice – 10 Things Landlords Should Seriously Consider Before It Is Too Late

1. Know when to stop investing and start living. I have a friend who is fast approaching 50 years old who owns 82 properties. His goal is to get to 100. What’s the point? 100 is just another number isn’t it? What would you rather own, 100 properties up North or one large shopping Mall? I know which I would choose! Let’s say his properties are worth just £50k each, that means his portfolio is worth about £4 million. I can’t find a period in history when property values haven’t doubled in value over 20 years – feel free to correct me if you know different. Even if he’s got 100% mortgages today and never pays a penny off the capital he’s likely to be worth at least £4 million net well before he’s 70 if history repeats itself. Think what effect inflation will have had on his rental income and net profits too! [Original source: here]

Estate planning is such an important part of any personal tax planning but one that people ‘put off’ until it is too late to put an effective plan into place.

If you would like to discuss how estate planning can benefit you and your family then call for an informal consultation by phoning swansea on Swansea 01792 894375.

Estate Planning