Last year, HMRC collected a record-breaking £4.9bn from IHT, and research from TIME Investments revealed that 36% of consumers aged 55 and over that seek financial advice from an IFA have not considered IHT planning, despite IHT taking 40% of a total qualifying estate.
TIME Investments IHT expert Henny Dovland commented: “Financial planning needs to be done on an intergenerational rather than individual basis. Instead of considering bequeathing assets to children alone, it is worth considering how grandchildren and great grandchildren can benefit. It is an area where expert advice from a financial adviser is needed.”
As a way to combat this and ensure that you are getting the most out of your inheritance, Dovland suggested “considering intergenerational financial planning".
This involves thinking about how much income is required in retirement and how long this income needs to last. Once this has been established, financial advisers then need to find out whether that income target can be reached based on an assessment of available assets.
When there are surplus assets, IHT needs planning needs to be considered. Trusts can be setup that are exempt from IHT, however, once the assets are in the trust the individual loses control of them.
In relation to property, the nil rate band remains at £325,000, meaning that estates exceeding that worth could be liable for IHT. However, the government has introduced the Residence Nil Rate Band (RNRB) from April 2017, which grants homeowners a further £100,000 before being subject to IHT. This is further set to increase annually by £25,000 until 2020.
“We all know the saying ‘you can’t take it with you’ but the pot still needs to last until the end. Intergenerational planning is about striking a balance between providing for each of the individuals with the right tax efficient income to cover different needs at various stages of their life. The right advice at the optimum time is crucial in ensuring each generation can share in the family’s wealth both today and in the future,” Henny concluded.
NEW BUILD IN FOCUS - NEW EPISODE OF THE MORTGAGE INSIDER PODCAST, OUT NOW
Figures from the National House-Building Council saw Q1 2025 register a 36% increase in new homes built across the UK compared with the same period last year, representing a striking development for the first-time buyer market. But with the higher cost of building, ongoing planning challenges and new and changing regulations, how sustainable is this growth? And what does it mean for brokers?
The role of the bridging market and technology usage in the industry
Content editor, Dan McGrath, sat down with chief operating officer at Black & White Bridging, Damien Druce, and head of development finance at Empire Global Finance, Pete Williams, to explore the role of the bridging sector, the role of AI across the industry and how the property market has fared in the Labour Government’s first year in office.
Does the North-South divide still exist in the UK housing market?
What do the most expensive parts of the country reveal about shifting demand? And why is the Manchester housing market now outperforming many southern counterparts?
In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance, to explore how regional trends are redefining the UK housing, mortgage and buy-to-let markets.
In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance, to explore how regional trends are redefining the UK housing, mortgage and buy-to-let markets.
The new episode of The Mortgage Insider podcast, out now
Regional housing markets now matter more than ever. While London and the Southeast still tend to dominate the headlines from a house price and affordability perspective, much of the growth in rental yields and buyer demand is coming from other parts of the UK.
In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance.
In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance.
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