Heartfelt request for IHT and retirement planning

LDJ_1955

Sorry, I'm not sure. Does the following help in anyway?

The ground floor shop (commercial property) + residential flat on top has been in my name since the 80s. )urchased for under 40k would be a good assumption. 

Estate is worth 1.6M. ~ 500k for the commercial property + 500k for the 3 bed flat on top of it + 600K for the house we all live in and intend to do so for the forseeable. House purchased in 2000 for 180K. No other major assets or large sums of cash (nothing more than 20K in the bank). Rent comes in as per first post.

Keep_pedalling

LDJ_1955 said:

Sorry, I'm not sure. Does the following help in anyway?

The ground floor shop (commercial property) + residential flat on top has been in my name since the 80s. )urchased for under 40k would be a good assumption. 

Estate is worth 1.6M. ~ 500k for the commercial property + 500k for the 3 bed flat on top of it + 600K for the house we all live in and intend to do so for the forseeable. House purchased in 2000 for 180K. No other major assets or large sums of cash (nothing more than 20K in the bank). Rent comes in as per first post.

A small percentage CGT on the commercial property might be charged at 10% but the bulk would be at 20% (the higher rate kicks in once you income + gain takes you into the higher tax bracket. The residential property would be an extra 8%. The problem with selling up to try to reduce IHT liability is that if you die within 7 years you get hit with both CGT and IHT. If you needed to raise capital you could always sell your home and move into your rented property which would have no immediate tax liability. 

MarzipanCrumble

I also have an estate which is IHT viable.  I pay for Life Assurance in order to cover any IHT costs when I die.  One I took out when I was in early 60's and isn't that much tbh but other is late 60's and is about 4x other.  

I look at is as a tax free, out of estate hand out to my 2 sons.  If I have mitigated IHT by gifting and living long enough then they get it all.  If I die and owe IHT Tax then this is paid out immediately, not counted in my estate, and can be used to pay IHT tax.

So I don't like paying out, but my pension income can afford it.  It is a solution.  The younger (with less health problems) you do it the less (possibly) you pay.  My first was with Vitality which does give discounts on proving a healthy lifestyle.  Hence I got incentivised into walking 10k steps per day!  (Proven by a compatible wrist device i.e. Garvin)

Now that is something I cannot not do!  Walk 10K / day lol.

NlghtOwl

Speak with your accountant to see if eligible for entrepreneurs relief, paying 10% cgt I believe. Also if you sell, you’ll have the funds to pay the cgt before distributing further.

Keep_pedalling

NlghtOwl said:

Speak with your accountant to see if eligible for entrepreneurs relief, paying 10% cgt I believe. Also if you sell, you’ll have the funds to pay the cgt before distributing further.

That would only apply if the rented properties were held in a Ltd company, these appear to be owned by the OP personally.