STORM CLAIMS: If your property has been damaged as a result of the recent weather conditions and you don't need us to take urgent action you can notify us online of your claim. 

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STORM CLAIMS: If your property has been damaged as a result of the recent weather conditions and you don't need us to take urgent action you can notify us online of your claim. 

If you do require urgent action to be taken by us, call: 0800282652

Investing, Pensions and Finance

How to pass on as much as possible

granny and grandchild baking

Inheritance: How to ensure you can pass on as much as possible.

If you expect your estate to incur Inheritance Tax (IHT), then now is the time to consider how best to reduce how much HMRC take.

In a nutshell, while the first £325,000 is tax free, as is up to £175,000 of the value of your home, if you’re leaving it to a direct descendant, IHT is charged at 40% on everything you own, including all property, possessions and money. Mitigating and doing what you can to avoid the tax is an important part of estate planning, to help make sure you are able to pass on as much to your chosen beneficiaries as possible.

The rules are complex, so professional advice can be invaluable. A Financial Adviser can talk you through the many different ways to maximise how much you’ll pass on to your loved ones. These include, among others:

Gifting

You pay no IHT on anything you give to your UK domiciled spouse or civil partner during your lifetime or on death.

You can give away up to £3,000 each tax year and unlimited regular gifts out of income which don’t impact your normal standard of living, without having to worry about IHT. Most other gifts will be free of IHT if you live for seven years.

Be aware that there might be Capital Gains Tax to pay on certain assets that you give away in your lifetime. Also, it’s important you don’t continue to benefit from anything you give away, such as a house you continue to live in without paying a market rent.

Trusts

Trusts can be very useful for succession and tax planning; you can, for example, avoid IHT by putting a life insurance policy in trust. However, the tax treatment of trusts is complex, so it’s important to take financial advice before taking this route.

Reliefs

If you own some types of property, you may get relief from Inheritance Tax, either at a rate of 50% or 100%. Certain farming, woodland and heritage assets are among those that may benefit from tax relief, as well as qualifying business assets.

Reduced rate

You can reduce the rate of Inheritance Tax from 40% to 36% by leaving at least 10% of your net estate (the total value of your assets, less any debts, liabilities, exemptions, reliefs, and the nil rate band) to qualifying charities. The rules are complex, so this is another area where professional advice can make a big difference, and allow you to support causes that are important to you.

IHT planning is complex but hugely important, so we recommend you speak with an NFU Mutual Financial Adviser to discuss how you can maximise the amount you pass on. Locate your local NFU Mutual Financial Adviser, or call us on 0800 622 323, option 3.

When you contact us we'll explain the advice services we offer and the charges.

NFU Mutual Financial Advisers advise on NFU Mutual products and selected products from specialist providers.

Financial advice is provided by NFU Mutual Select Investments Limited.

Please note that Inheritance Tax advice is not regulated by the Financial Conduct Authority or the Prudential Regulation Authority