15:24 27 February 2013
Having a good strategy for any inheritance you’re planning on leaving your family is one of the best things you can do for them. There’s no way to totally escape paying inheritance taxes, but you can limit the amount significantly if you start planning now.
Inheritance taxes are levied against the estates value above £325,000 left by people when they pass away. It includes money and all remaining property and possessions minus debts and expenses like funeral and burial costs. So it is imperative that you understand and know the overall value of your estate so that family members can be aware and adequately prepare for the tax bill that will be due.
So, what are some steps you can take to minimize how much your estate will owe to the government? Here are some suggestions that will help reduce your inheritance tax bill:
•Gifts that you leave to your spouse are not taxable, so leave a sizable portion of your estate to your spouse and save a bundle.
•Donate a portion of your estate to charity. What better way of getting a great two-for-one deal. Support a worthy cause and reduce your inheritance tax bill at the same time.
•You can designate a gift to a child (children) or grandchild (grandchildren). The key point to remember is that when you make this designation it must be at least seven years before your passing in order to avoid taxation of the gift (gifts). Start planning now.
•If at all possible, make your family aware of your plans. Knowledge and preparation are vital and can help them avoid fees and penalties for not filing the inheritance tax correctly and on time.
Reduce the burden of inheritance tax worries by simply being prepared and knowing what to do and how to do it. Be sure to get legal advice if you need it.
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