Inheritance tax allowance

lisyloo

I would suggest that you pay for some professional advice.
Not being cheeky it's a serious suggestion as I think it would be worth your while (if you genuinely have that money and it's not a hypothetical question).

EdInvestor

moonrakerz wrote:

I presume EdInvestor's comment was around "Main Exemptions, V "

Yes.

So if I give ALL my pension income to my kids and live off my capital............... ?

As long as your gifts from income are on a regular basis (I understand), eg Xmas and birthdays, and do not diminish your lifestyle, then it would appear to be up to you.

But suggest you check with your accountant.

Jake'sGran

EdInvestor wrote:

You can give away as much as you like as gifts as long as they are from income, not capital. As of April assets under 300k won't be counted for IHT.

We went to the solicitor last Friday to discuss using the two nil rate bands and having a discretionary trust. I did get the impression this lady did not want to deal with my will (got a horrible feeling I have already written about this!) I do understand it better although I had read a lot about it previously. Just one thing I wanted to mention is that I was told that if a discretionary trust is arranged the solicitor said the trustees must meet twice a year. I think the idea of this was to discuss if they can release cash to the remaining spouse or other beneficiary. Have you come across this aspect before Ed? I already give away £3000 to my grandchildren each year but she suggested I try to give away more and if I don't make it to the end of a further seven years the sums given would then be considered as coming from the £285,000 trust. Our situation is unusual in that the house is not the main element of our savings.

Jake'sGran

PS to last post of mine. Apparently IHT allowance is going up in increments for the next few years.

dunstonh

300k from April 2007 and 315k from April 2008

There is no requirement for trustees to meet twice a year.

Jake'sGran

dunstonh wrote:

300k from April 2007 and 315k from April 2008

There is no requirement for trustees to meet twice a year.

Thank you for that Dunstonh. I had not come across that before and today I found one of the IR's booklets on the subject and it does not mention it. I wonder what made the lady solicitor say that it was necessary. Perhaps she is not as experienced in IHT planning as I had hoped. I did ask if she arranges this type of will quite often and she said she had done a few but, of course, not every day. Maybe I need to find someone else.