Posted On / 19.01.2016

Showing Resolve in January

If one of your New Year resolutions is to take a fresh look at finances and legal affairs, our advice is to ‘keep it simple’.

In these turbulent times, with pension reforms and changing tax rules, it has never been so important to plan ahead and keep matters under review.

An expert advisor can provide the best professional advice for you and your loved ones.

Among the measures to consider is a new additional inheritance tax allowance for married couples who own their own house and wish to leave it to their children or grandchildren.

Coming into force in April 2017, it is a fiendishly complicated allowance to work out but one way to help your Executors is to make sure your Will is up to date and that you have good record keeping.

In particular, Executors will need to know the sale proceeds and the whereabouts of any properties you may have sold during your lifetime. Make sure you also keep details of your spouse’s estate if they have died before you, so that your Executors can claim an inheritance tax ‘transferable nil rate band’ if necessary.

There is a place for ‘trusts’ in some Wills, depending on what assets you own and the circumstances of your beneficiaries. However, for tax purposes, it usually makes sense to have a straightforward Will drawn up by a professional.

Deeds of Variation are a useful mechanism for retrospectively amending a person’s Will for tax, or indeed other purposes. So if you have been lucky enough to inherit some money but wish to pass this onto your children, a Deed of Variation is the most tax effective way to do this.

Coming up to the end of the tax year in April, you should also be aware of the inheritance tax gift rules which allow you to give away up to £3,000 tax free as well as £250 to as many people as you like with no inheritance tax consequences. In addition there is the useful, but under used, ‘gifts out of excess income’ inheritance tax allowance.

You should also make sure you have up to date Lasting Powers of Attorney in place so that should you have an accident or become ill, someone else you trust can step in to deal with any financial, medical or welfare decisions.

So keep things simple and up to date for the benefit of you and your loved ones, and make sure you take expert professional advice to take advantage of all the complicated tax benefits that are available.

For more information contact Naomi Dyer on 01935 811307 or naomi.dyer@battens.co.uk

Visit our Wills and Trusts page by clicking here

As well as our offices in Yeovil, Dorchester and Weymouth, Battens is available in Castle Cary:

Every Tuesday morning at The Shambles, Market House, Castle Cary between 9:00am-12:30pm

To make a Tuesday appointment please call: 01963 834477