Reduce UK Inheritance Tax Gift Your Home
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- เผยแพร่เมื่อ 12 ต.ค. 2022
- Avoiding Inheritance Tax (IHT) through trusts is possible with this quick guide - learn how to set up and benefit from trusts today to secure future savings for your family or business!
Are you looking for ways to reduce the burden of inheritance tax in the UK? One effective strategy is gifting a home to your children. In this informative video, we dive deep into the intricacies of this estate planning technique, exploring the benefits, considerations, and potential pitfalls involved.
Our expert presenter breaks down the key concepts, including the current inheritance tax thresholds, rules governing gifts, and exemptions available for gifting property to children. You'll learn about the seven-year rule, which determines the tax implications of such gifts based on the duration since the transfer occurred.
Additionally, we discuss practical tips for navigating the gifting process, including the importance of seeking professional advice from solicitors or tax advisors to ensure compliance with HM Revenue & Customs (HMRC) regulations.
Whether you're a homeowner looking to safeguard your assets for future generations or a family member interested in understanding inheritance tax planning, this video provides valuable insights to help you make informed decisions about your estate.
Don't let inheritance tax overshadow your legacy. Watch now and empower yourself with the knowledge to protect your wealth and secure your family's financial future.
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This is such a useful video, thank you so much for your professionalism Sir!
I am delighted it helped
Avoid 40% UK inheritance Tax (IHT)? Use gifts and trusts Read about our IHT services www.optimiseaccountants.co.uk/services/inheritance-tax-advisors/ Need a buy to let mortgage? survey.zohopublic.com/zs/GuCCYx
A very informative video 📹 👏🏿 👍🏿
Thank you and I am pleased it was helpful
Great video
Thank you and a very kind of you
The last example of using the Trust to mitigate CGT & IHT - does it apply to a But To Let property too?
It can if you structure the trust correctly
Could you please point me to resources including books regarding living trusts? Thanks
Sadly I do not know any good ones. Sorry 😞
Hi Really good video thank you. Could you clarify something for me please. You said in your video at time 3.27 that there is £1,000,000 IHT lifetime allowance + RNRB. I thought the £1,000,000 includes the £175k x 2 = £350k RNRB so you don't get it on top of the £1m - is that correct? My second question is on the £1m allowance ( including RNRB) can this allowance be used to include a buy to let property jointly owned by a couple in addition to their main home ? Thank you.
Each person might benefit from £325,000 inheritance tax allowance in the lifetime. They may also be illegible for the £175,000 nil rate band on there a red residential property. Add those together and you get £500,000. This is doubled up as a couple to £1 million. I hope this clarifies
Thanks for the clarification. At 11.50 you were explaining about moving a buy to let into a trust and offsetting the value with IHT lifetime allowance. Can a trust be a company ? Thank you.
A trust and a limited company or two separate things and not interchangeable
Thank goodness for a safety deposit box.
Must be a big one though 😂
Can you transfer a Buy to let with no mortage outstanding to your child if they are currently power of attourney
Yes you can do this. There will not be any capital gains tax if it is a home. However, given it is a buy to let property, capital gains tax will apply. No tax will be charged, unless there is any type of consideration (moneys worth transfer).
Thats great new, although my solicitor said that as my brother and I are powers of attorney and my brother wants to transfer the the buy to let house, over to him, it could be done but it wasn't straight forward, it would be time consuming and expensive. also to note my dad has early dementia but my um is of sound mind. thank you
@@Simon-Misiewicz-US-UK-Taxes
IHT needs revaluing it’s so disproportionate to hse prices. Not revalued for 18yrs.?..?
100% agreed with you 🙏
What about this theoretical situation; Parents own 3 houses all owned outright 1 primary residence and 2 that are rented out, the 2 rented houses were purchased at a very low price and subsequently would be valued at nearly triple the original purchase price. How would these properties be passed to two children/adults. Would a business be better? Or trust thanks
Give the values you will appreciate that tax planning with your fathers accountant would’ve a good investment to make to get the most suitable tax plan 👍
@@Simon-Misiewicz-US-UK-Taxes yes however my parents have never had an accountant always been well informed I am 21 and staring a 3 year training course for my ACA qualification, so what would be the next step, you believe simply speak to a tax accountant
For peace of mind and to ensure that things are done correctly, a tax professional would be the safest next step 🙏
What if you don't have it in writing? My partners late mum gifted him the house and lived in it for years before she died. Well over 7yrs.
Without proof It would be as though it never happened
@Property & Expat Tax Tips What a right pain. He literally has proof of paying the council tax all these years 🤦🏼♀️
Stupid question
How much does it cost to get advice and set something like this up?
Please see link to see our services survey.zohopublic.com/zs/80zrXp
is buy to let different to second home ?
They are identical when it comes to tax purposes
If you use the 325k IHT allowance for buy to let property, then you no longer have this allowance for family home. Is my understanding correct?
That is correct. However, you might benefit from the £175,000 Residential Nil Rate Band (RNRB) if the hime value exceeds £325,000 up to £500,000.
Get some tax advice from your accountant on this point
@@Simon-Misiewicz-US-UK-Taxes if a home is valued at 1 000 000 owned jointly by a couple then the surviving will pay 0 IHT is this correct?
If the remains spouse is in the UK then yes
@@Simon-Misiewicz-US-UK-Taxes 1. the surviving spouse is in the UK and intends to stay in the UK, then inheriting the 1 000 000 mansion will not attract any inheritance tax? No?
2. The property will only attract a capital gains tax whenever it is sold?
3. Prior to selling it if the property is co-owned by 3 people will the CGT be minimised to the tax allowances of all 3 people?
Thank you for the additional questions.
Given the complexity I would much rather you speak with your tax advisor.
You are in danger of getting bits of information and trying to pull them together to form a strategy.
This often leads to mistakes being made please book a good hour with your tax advisor to explore all of the scenarios that you are talking about
Why did you say the settlor cannot be a beneficiary?
The settlor cannot be the beneficiary and avoid IHT.
@@Simon-Misiewicz-US-UK-Taxes can a trustee be also an executor?
I can’t see why that would not be possible but do direct this question to a legal professional. We can support on tax matters but law is not our speciality.
Is it true that if someone has a house worth 327 thousand pounds and leaves it to their child in their will, will the child pay inheretence tax? or does the 500k threshold for leaving to childeren take effect and mean no inheritance tax is owed? sorry I'm new to this
Great questions
There is a 325 IHT lifetime allowance and a 175 residential nil rate band these rates doubled for married couples
The 175 is reduced by £1 for every £2 over a net asset value of £2m.
This is quite complex and professional advice is worth seeking
@@Simon-Misiewicz-US-UK-Taxes thank you for responding, Ill have to ask profesionally as I still dont quite understand, again thank you for resonding though
I have lived in a house for 35years. No rental. Owner has dissappeared abroad. Claiming it as mine is not a problem, but would i have to pay tax on it?
That is a good question. One that cannot be answered your TH-cam channel.
Have you checked with Land Registry? This will record ownership.
Many thanks for the reply. Yes it has another persons name. No address@@tonykelpie