Inheritance tax query

wildcaz

Hi. I'm 53, single with no children, and terminally ill.

I own a house outright, I haven't had it valued yet, but would estimate it's value at a little under half a million pounds. I have no other assets to speak of, a couple of grand in the bank, and a twenty year old car, and that's about it.

When I bought the house, some time before I became ill, I made a very basic will, dividing everything 50/50 between my partner of 20 years, and my brother. My partner and I have never lived together, he owns his own smaller property outright. My brother is married with one child, and has a house with a mortgage.

I know that if I survive until April, I'll benefit from the new inheritance tax threshold, and I'm also aware that if I were to marry my partner, I could leave everything to him and avoid inheritance tax completely.

What would the tax situation be if I were to marry my partner and still split the estate between my partner and brother? Would tax be payable on the half left to my brother (assuming the value of the house exceeds the threshold)?

I've tried researching this, but have been unable to clarify it. It appears to be a fairly unusual situation. I'd be grateful for any light that anyone can shed on this for me.

Many Thanks

Keep_pedalling

The changes affecting the tax threashold only help people leaving their main residence to their direct children or their childrens offspring, so that does not help in your case.

If you marry however, you will take your estate out of IHT territory as your husbands legacy would be exempt and you would be leaving less than your nil rate band to your brother. Marriage would make your current will invalid, so before you marry you need to make a new one, and this should be done through a solicitor.

wildcaz

Fantastic news. Thanks very much.

Yorkshireman99

wildcaz wrote: »

Fantastic news. Thanks very much.

Note that you can get the will done before th marriage or civil partnershp provided it has the appropriate clause. You solicitor will advise.

nom_de_plume

Keep_pedalling wrote: »

Marriage would make your current will invalid, so before you marry you need to make a new one, and this should be done through a solicitor.

Probably a typo as a new will would still be invalidated by marriage unless...

Yorkshireman99 wrote: »

Note that you can get the will done before th marriage or civil partnershp provided it has the appropriate clause. You solicitor will advise.

The appropriate clause being that the will is made in anticipation of a forthcoming marriage.

wildcaz

Thanks. I knew I'd have to do a new will. That's not a problem.

Tom99

[FONT=Verdana, sans-serif]If you marry your partner will also inherit the unused part of your Nil Rate band to use on their own estate at a later date.[/FONT]