Don’t Make Inheritance Tax Taxing

Whenever Brits are polled on their most hated tax, without fail, one tax in particular always finishes top – inheritance tax. As a nation, we want to leave as much as we can after death to our loved ones and the thought of the taxman taking a slice evidently annoys us.

However, for there are plenty of simple and efficient ways to reduce your inheritance tax liability and ensure that you leave as much as possible to your loved ones.

  • Making a Will

It’s a simple fact that failing to write a Will generally means you will end up paying more inheritance tax. Without a Will in place, your estate will be doled out according to the rules of intestacy, and chances are the taxman will help himself to a healthy chunk of it.

One simple way to reduce your inheritance tax via your Will is to leave some to charity, as these gifts are free of tax.

  • Understand the thresholds

Inheritance tax is charged on estates once they pass £325,000 in value, at a rate of 40% on everything above that value. However, couples are able to pass their allowance over in full to their partner – in other words, couples have a £650,000 allowance overall. If their combined estate ends up being worth less than that, there will be no tax to pay.

There is also a new additional element to bear in mind here. The ‘main residence’ allowance allows you to pass on your family home to a direct descendent, with an additional tax-free allowance included. For this year it stands at £100,000 and will increase each year until 2020/21 when it hits £175,000. As this allowance applies per person, it will mean a total tax-free allowance of £1 million for couples.

  • Gifts

Even if you give something away, the taxman will still class it as being part of your estate if you die within seven years of making the gift. It’s a way of preventing people from handing over their home on their deathbed and avoiding the duty. Live longer than seven years and there’s no tax to pay.

However, there are certain gift allowances anyway which are free of tax. Everyone has a £3,000 limit each year, and what’s more this limit carries over to the following year if you don’t use it, to a maximum of £6,000.

On top of that you can give away £250 to each of any number of people every year, while further allowances are in place for wedding gifts to family members, friends and even political parties.

  •  Write your life insurance policy in Trust

Lastly, it’s a good idea to write your life insurance policy in Trust, as this essentially separates it from the rest of your estate.

Usually your life insurance payout will be added to the value of your estate before it is paid out to your loved ones, meaning they have to wait a while in order to receive anything and then may have to pay tax on that payout too.

But writing it in Trust means it is viewed as being outside of your estate, ensuring that your loved ones get every penny and likely get the money quicker to boot.

For expert advice on inheritance tax, contact us today on 0161 771 2056 or email help@FinanceNorthEPS.co.uk.


To find out more please contact us below

Finance North Estate Planning Services
Cheshire Office – 0161 771 2056
Staffordshire Office 01782 963 303

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What sets our Asset Protection Trusts apart from the competition?

Why use Wills and Pilot Trusts?

Assets not protected by a Trust face attack from –

 Care Fees
♦ Marriage After Death
 Divorce or separation settlements
 Creditors or Bankruptcy claims
 Taxation

All of the above threats will also apply to future generations.

Distributing assets absolutely to beneficiaries exposes those assets to risk. When assets are distributed to beneficiaries “absolutely”, (i.e. they receive cash, property or other assets, as a direct lump sum payment) so much can be lost.

These assets are then considered to be part of the beneficiary’s estate and would be at risk of attack from any future divorce settlements, care costs, creditors and taxation.

This is assuming that there is anything left to leave to their children/grandchildren!


Unfortunately, the costs involved in moving into a Care Home can literally wipe out entire savings and the family home may have to be sold to pay for care fees.

When someone enters Care, they are automatically “means tested” and ALL of their assets, including the family home are taken into account. Only those who have very few assets will escape the costs of care.

With the strategic use of Trusts, we can ensure that our client’s children and grandchildren or chosen beneficiaries are able to benefit completely, from the inheritance they want them to receive.

Using the correct Trusts and associated strategies we can provide the protection and control of a multitude of assets from those risks noted above. This protection can extend from the family home, other properties, investment products and liquid assets, Life Assurance, Pension Death Benefits and Business assets.


Many people are aware that there are strategies widely available for those wanting to protect their homes and other assets for future generations, against the threats from any future divorce settlements, creditors and bankruptcy, Care Costs and Taxation.

Here at Finance North Estate Planning Services we been successfully providing these strategies, to our clients.

However, where a client later enters care, having placed a share of their property in a Trust in their lifetime, it has become apparent that local Councils are now fighting these strategies much more aggressively than in past years and the tone of the letters now being sent to clients, or their relatives are extremely worrying.

This has resulted in many relatives, owing to their lack of knowledge and expertise, effectively “caving in”, assuming that they had no choice but to sell the family home, in order to fund the Care fees, when in reality they did not have to do so.

We have been taking on these challenges from Local Authorities, for our client’s with the correct Asset Protection strategies in place and have never lost a case yet!


So confident are we of the success of these strategies, that we offer “The Probate Preservation Plus Trust” which comes with a Money Back Guarantee.

The Probate Preservation Plus Trust (PPPT) is essentially Lifetime Asset Protection Planning. It is available for both Single clients and Couples, who wish to place the family home into Trust in their lifetime, thus protecting those assets from potential attack from:

♦ Divorce
♦ Creditors / Bankruptcy
♦ Testing for Disabled Beneficiaries
♦ Taxation & Generational IHT
♦ Care Fees
Probate Fees & Delays
♦ Costs & Delays from the Court of Protection.

Quite simply, it is a Money Back Guarantee for those who have established the planning, then later entered care and the strategy is subsequently challenged by the Local Authority.

In detail when someone has the need to enter a Care Home, the Local Authority immediately issues the necessary paperwork to be completed for “means testing” (Section 47 Financial Assessment). Our specialist Legal Team will then liaise directly with the Local Authority on the client’s behalf. If a challenge is then made by the Local Authority, all of the Legal costs incurred will be covered (up to a maximum of £500 plus VAT).

We will complete all of the necessary forms and construct any legal arguments necessary, to uphold the planning, and to win the case.

Should we fail to win the case and the client’s home is subject to the payment of their Long-Term Care Fees, then our Money Back Guarantee will reimburse them.

Remember – We have not lost a case Yet!


Our PPPT ensures that, no matter what the client might have done previously, a Chargeable Lifetime Transfer charge will never be payable.

Our PPPT ensures that, no matter what the value of the Property increases to, there will never be a Periodic or Exit Charge payable.

The PPPT ensures that, no matter how much growth in value the Property has experienced, there will never be an “unexpected” IHT liability caused by the Trust.

The PPPT has been drafted to ensure that, if the clients Executors need to benefit from the Residential Nil Rate Band, the property can fall through the client’s Will to Lineal Descendants.

The PPPT ensures that, if the Trust is successfully challenged, the client will get their fees fully refunded


To find out more please contact us below

Finance North Estate Planning Services
Cheshire Office – 0161 771 2056
Staffordshire Office 01782 963 303

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Will Disputes: What If You’ve Been Left Out?

Losing a loved one is always an upsetting time. That upset is only heightened if you later discover that you have been left out of their Will, or in some way under-recognised.

There are options open to you if you wish to contest a Will, thanks to the Inheritance (Provision for Family and Dependants) Act 1975. The Act allows people to bring a claim against the estate in certain circumstances, when they feel that “reasonable financial provision” has not been made for them.

The courts will then evaluate where such provision has been made for you, and if not, what provision needs to be in place for you. In order to make a successful claim, you will need to demonstrate to the courts that you had a reasonable expectation of having your living costs met by the deceased.

All sorts of factors will be taken into account here, such as your financial position and needs (both now and in the future) the size of the estate and even your conduct.

There is a host of different circumstances where someone may wish to challenge a Will, for example a former spouse or a child of the deceased, or simply someone who was financially dependent on the deceased before they passed away.

There is a time limit on making a claim though – it must be issued at court within six months of the date of the grant of probate.

The court has the power to step in and revise the way that the estate has been divided – this may mean you receiving a lump sum or even the entitlement to a regular payment from the net estate of the deceased.

The issue has enjoyed a lot of press coverage in recent years, primarily down to a case where a mother left her £486,000 estate to three charities, leaving out her estranged daughter entirely.

While the daughter succeeded in challenging this, winning a six-figure settlement, that has now been overturned by the Supreme Court.

Jon O’Brien, “The 1975 Act opens up the possibility of challenging a Will if you believe you have been unfairly left out, though it is important to get legal advice first. You will also need to prove that you could rightfully have expected some sort of contribution from the deceased.”

Finance North Estate Planning Services
Cheshire Office – 0161 771 2056
Staffordshire Office 01782 963 303

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Sir Bruce Forsyth, Didn’t He Do Well!

It was announced on Friday 18th August 2017 that national treasure and entertainer Sir Bruce Forsyth has died.

With a show-biz career spanning over 75 years, no matter which generation you are from, it’s likely you will have fond memories watching Sir Bruce on a Saturday night.

His much-loved TV shows included The Price is Right, Play Your Cards Right and The Generation Game. More recently, he co-hosted the hugely successful Strictly Come Dancing and wowed the audience with his dance moves, proving he was certainly young at heart.

Sir Bruce has always captured the hearts of the nation, and his famous catchphrases including “Nice to see you, to see you, nice!” will certainly still be remembered in years to come.

Recognised as a veteran of entertainment, in October 2011 Bruce Forsyth received his knighthood, just a few years before he decided to step back from the spotlight in 2014.

For an Edmonton boy who started work aged 14, we say “Didn’t he do well”.

Sir Bruce is survived by his wife of 36 years, former Miss World, Wilnelia Merced and his impressive brood of six children, nine grandchildren and three great-grandchildren.

He left his £17 million fortune entirely to his wife, which means inheritance tax will not be applied. She has also inherited his company, Bruce Forsyth Enterprises, and is now sole Director.

For richer, for poorer, in sickness and in health, everyone should make a Will. If you want to make sure the future generation in your family aren’t left without a treasured heirloom and are taken care of should the worst happen, contact Jon O’Brien here a Finance North Estate Planning Services today to arrange an appointment at a convenient time for you.

Jon O’Brien has been advising on Estate Planning for over 20 years. We are your local trusted advisers when it comes to writing Wills, putting in place Lasting Powers of Attorney and other estate planning requirements.

Don’t put it off – contact us today on 0161 771 2056
or email us Help@FinanceNorthEPS.co.uk

logo0161 771 2056
Wills ♦ Trusts ♦ Probate ♦ Funeral Plans ♦ Power of Attorney
Business Succession Planning ♦ Care Planning Challenge Support
Offices in Cheshire and Staffordshire

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Breaking News – Bringing Wills Into The 21st Century

Writing a Will is wrongly often thought of as something only older people need to worry about. But the Law Commission has called for the age at which one can write a Will to be lowered to 16, as part of a report into ways to update inheritance laws.

It pointed out that given 16-year olds can marry, join the army or live alone, they should be allowed to outline what they wish to happen with their assets when they pass away.

This is just one of a series of changes suggested by the Law Commission, which argued that many of the laws relevant to inheritance date back to Victorian times and are “out of step with the modern world”.

Another suggested change is the introduction of electronic Wills, arguing that the Lord Chancellor should be given the power to bring them into force. The Law Commission also called for the removal of some of the formality around Will writing, by giving the courts powers to recognise a Will in cases where some of the formality rules were not followed, but the deceased had made their intentions clear, as well as an overhaul of the rules protecting those making a Will from being unduly influenced by another person.

There will now be a public consultation on the proposals until November before any final decision on law reform are made.

Here at Finance North Estate Planning Services say “Writing a Will should be simple and straightforward, but the Law Commission is absolutely right that the law is outdated and may be a reason why so many people don’t bother to write one, as around 40% of adults die each year without having written a Will. That’s unacceptable, and measures which will make it easier and more inclusive are very welcome.

“It doesn’t matter whether you’re 16 or 60, setting out exactly what you want to happen to your assets after you pass away is vitally important, and a Will is the only way to do that.”

“If anyone is interested in finding out more about writing a Will or updating their current one, they can call one of our offices below – we’d be happy to help.”

Finance North Estate Planning Services
Cheshire Office – 0161 771 2056
Staffordshire Office 01782 963 303

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Reasons for a Property Protection Trust

A Property Protection Trust is designed to help and protect your property from creditors including an assessment for long term care fees.

Our Property Protection Trust will ensure that your estate is kept intact by protecting your share of your home (or other property, if required) or the value in it.

We do this by firstly changing Joint ownership of the property to Tenants in Common usually each owning 50% this then enables you to “Will” your share to your chosen beneficiary via your Family Trust.

By leaving your share of the property in a Trust with a life interest to your partner/spouse you safeguard your assets from being lost should your partner re-marry, or be diluted if that partnership ends in divorce. It also protects the trust property from bankruptcy and care costs in later life for the surviving partner.

Importantly the Trust also protects the interests of the survivor, allowing them to live in the property until their death, (or, if required, until they cohabit or remarries.) If the survivor then goes on to remarry, they cannot leave the whole of the property to their new spouse, as a portion is already owned by the Trustees on behalf of the chosen beneficiaries. The survivor can also move house if they so wish, using the whole of the proceeds towards another property, or raise capital by purchasing a smaller property, a greater proportion of which will then be owned by the Trustees.

  • Typical Example

On first death, the Deceased’s share of the property is passed into their Trust via the Will. The surviving spouse/ partner continues to live in the property and is still able to move home if they choose to do so.

In the event that the survivor enters Care, the survivor only owns a half share of a house

 

PPT1

  • Benefits

Care
Holding the assets in the Trust ensures that they do not add onto the Beneficiaries’ own estates and so cannot be assessed for their Care costs.

Marriage After Death
Placing half of the family home and other assets into a Trust on first death ensures that, should the surviving spouse/partner marry in the future, those assets cannot
be taken into the marriage and removes the threat of your own children being disinherited. The survivor is still able to use the assets in the Trust.

Creditors or Bankruptcy
Similarly, if any of your Beneficiaries are subject to Creditor Claims/Bankruptcy then their inheritance would not be exposed to these claims.

Divorce
Placing the assets into Trust ensures that, if your children/ chosen Beneficiaries are subject to Divorce proceedings then what you intended them to receive is protected from any Divorce settlements.

Further or Generational IHT
Holding the assets in the Trust ensures that they do not add to the Beneficiaries’ estates and impact on their own Inheritance Tax

Residence Nil Rate Band (RNRB)
Our trusts ensure that if there are lineal descendants as beneficiaries, the trust will still qualify for the RNRB.

Remember that making a basic double Will
only guarantees what happens on 1st death

 

Without the correct planning, some or all of your children’s or grandchildren’s  inheritance could be lost. However, with a few simple strategies we can protect you and your family from needless expense and worry.

Consider the Facts…

  • Everyone should have a Will, but 2 out of 3 people have not yet made a Will and those that have, may not have the correct Will in place
  • Many of the population lose their homes and / or savings to pay for care.
  • A large proportion of any inheritance is lost in future divorce settlements, to creditors or bankruptcy and unnecessary taxation.

Peace of mind is just a phone call away! Call us today on 0161 771 2056 or enter your details below…

Finance North Estate Planning Services
Cheshire Office – 0161 771 2056
Staffordshire Office 01782 963 303

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This page contains only general planning advice and is not to be construed as advice for any specific personal planning. Each strategy recommended is based on individual circumstances.

 

How to prevent things going wrong with your Lasting Power of Attorney

With dementia continuing to rise, the importance of Lasting Powers of Attorney (LPA) cannot be overstated. An LPA can be a vital tool, giving a friend, loved one or solicitor the power to make decisions on your behalf should you reach a position where you are unable to.

Safeguards are built into them to ensure they are used appropriately, but there are steps you can take to ensure things do not go wrong.

Choose the right attorney

If you want to prevent any future issues with an LPA, then choosing the right attorney at the outset is crucial. There are many duties involved in acting as an attorney for someone, so you need to pick someone responsible and organised, as well as someone who knows you well and can be trusted to act in your best interests.

You may want to select more than one attorney – this will make abuse of the powers associated with an LPA much harder.

If you do choose more than one attorney, you can set out whether they need to act together or separately for certain issues.

Informing loved ones

One important safeguard is the fact that the ‘donor’ (the person handing over their powers to their attorney) can name up to five people who must be informed before the LPA is registered. It’s important to do this – these loved ones can then step in and dispute the registration, should they believe that the donor was put under undue pressure or the attorney is set to behave in an inappropriate way

It’s a good idea to speak to your friends and loved ones who aren’t named on the document in advance of organising an LPA too. You can explain why you are doing it and how you want the powers to be used – this can help reduce the chances of fraud and should also reduce the chances of conflict between family members later on.

Guidance

Another safeguard is the ability for donors to have certain guidance for the attorney written into the LPA. For example, this may suggest that they meet a couple of times a year to go through bank details and discuss financial arrangements for the next six months. This should also make it harder for any fraud to take place.

Organising an LPA can give you peace of mind that you will have someone you trust making decisions for you, should you lose the ability to do so.

Choosing the right attorney, and getting the right LPA in place, can take some time, but it is time well spent.

If you’re struggling to choose an LPA or would like advice on how to appoint one, feel free to get in touch with us at Finance North Estate Planning Services on one of the numbers below.

Cheshire Office: 0161 771 2056 or Staffordshire Office: 01782 963 303

Or simply complete you details below and one of our consultants will call you back.

Finance North Estate Planning Services
Pole Farm Cottage, Pole Lane, Antrobus, Cheshire, CW9 6NN
The Dudson Centre, Hope Street, Stoke on Trent, ST1 5DD

www.FinanceNorthEPS.co.uk