Disclaimer
Prince Wealth Limited is a marketing agent for developers and other third party investment providers and whilst we endeavour to ensure the accuracy of information contained on our website, including figures and forecasts at the time of publication, Prince Wealth Limited does not guarantee or take responsibility for their accuracy. Prince Wealth Limited cannot offer financial advice and is not authorised by the Financial Conduct Authority to do so. Please be aware, that purchases of overseas properties and other overseas investments are not regulated by the Financial Conduct Authority. All investors should seek relevant advice in relation to their personal circumstances before proceeding. Prince Wealth Limited acts as a promoter and/or introducer for third parties. Authorisation from the Financial Conduct Authority is required for any advice on SIPPs. Prince Wealth Limited recommend you seek independent pension advise from FCA authorised pensions advisers. Please refer to the FCA website www.fca.org.uk for this purpose. Quoted figures are not guaranteed and are dependent upon investment performance. Past performance is not a guarantee of future performance.
Wealth protection and succession are complicated, difficult and emotionally charged
subjects. We take a sensible and open approach ranging from basic domestic estate
planning to highly complex offshore solutions.
Inheritance Tax (IHT) – The Basics
IHT is payable on assets that are gifted from your estate to others. 0% IHT is paid on the
first £325,000 gifted and 40% thereafter. If you were to gift 10% of your total estate to
charity, 36% IHT would be paid. Transfers to a spouse are IHT-free.
Nil Rate Band
The first £325,000 on which 0% is paid is known as your Nil Rate Band. You can pass your Nil Rate Band to your spouse as well. In this way, as a couple, you can pass on £650,000 of assets IHT-free. As of April 2021, there will be a further £175,000 per person of Nil Rate Band which can be used for the purposes of passing ownership of the family home. The means that, if your family home is worth £1 million, ownership of it can be passed free of IHT.
Potentially Exempt Transfers (PETs)
PETs are gifts or “lifetime transfers” which, depending on how long the donor survives after making the gift, have the potential to be free of IHT. Such gifts become free of IHT if the donor survives a further seven years. If the donor does not survive seven years then IHT will become due but “tapering relief” will reduce it as follows:
3-4 years – 80% IHT payable
4-5 years – 60% IHT payable
5-6 years – 40% IHT Payable
6-7 years – 20% IHT payable
You can also gift £3,000 per annum free of IHT.
* Information correct up until tax year 20/21.
Trusts
Individuals can transfer the ownership of assets into a “settlement”, otherwise known as a Trust. Trusts have three core components. For estate planning, they have the advantage that assets in Trust can be outside of your estate. You can nominate a set of beneficiaries (children etc) who can then control the assets after you’re gone. Because you are passing control and not ownership, IHT is not payable! UK trusts have a complex set of tax rules. Professional advice should be sought.
The Umbrella Asset Trust
The core purpose of the Umbrella Asset Trust is to protect assets for the family and planning succession in an orderly and sensible fashion. An excellent example of a Trust being used like this is the Grosvenor Estate.
The Umbrella Asset Trust is a legitimate means of protecting personally owned assets and managing them in a safe environment. It can be used to protect property, post-tax cash, shares, bonds, alternative investments and more in the UK and worldwide.
If you would like to arrange a Trust meeting or find out more about this service, simply click on the link below and complete the quick enquiry form or email us at enquiries@princewealth.co.uk and we will be in touch.
Neither Prince Wealth nor its Trust partners give legal or tax advice. If you require legal or tax advice, you should hire a licensed and qualified solicitor or tax advisor. The above information should not be considered advice capable of being acted upon.