How Much Does Inheritance Tax Cost and What Are The Exemptions?

Inheritance tax is an important part of estate planning, but how much does it cost? Learn about the basics of inheritance tax, plus exemptions and deductions with this comprehensive guide.
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[@Simon-Misiewicz-US-UK-Taxes]

Request a call back: If you are looking for a new US or UK real estate property tax specialists contact us here: survey.zohopublic.com/zs/80zrXp

[@arispoli1269]

Explaining this all to mum mum has taken over 2 years since his death. Her generation aren’t educated well on this stuff and its been a painful experience. I hate the UK tax system, its so regressive. But this was a wonderful video that she understood a little better. Thank you

[@Simon-Misiewicz-US-UK-Taxes]

I’m delighted that the video is useful. I’m sorry that you are grieving for a loved one whilst trying to get your head around the tax problem. Wishing you and the family all the very best

[@Tiffany48501]

Am I the only one who think 40% is a ridiculous amount. I think it should 20-25% at most

[@Simon-Misiewicz-US-UK-Taxes]

I am sure many would agree with you

[@RICHARD35ish]

Good video Simon and Louise, I just wondered what your thoughts were on family investment companies, where you give away the future growth of your company to your children? I would be interested on your thoughts of these structures for IHT planning. Thanks

[@Simon-Misiewicz-US-UK-Taxes]

We use these for our clients

[@Simon-Misiewicz-US-UK-Taxes]

Tell us more about your situation here survey.zohopublic.com/zs/60Bz5M. Feel free to read our article www.optimiseaccountants.co.uk/knwbase/how-to-minimise-inheritance-tax/. Why not join us at one of our live events? Register here: www.optimiseaccountants.co.uk/monthly-seminars/.

[@tomhewitt9187]

I enjoy the channel, wondered if you could help - What advice for an only child looking to inherit who just learned that farther died one year ago? A search agency has informed of father's death, he had always wanted to be in the life of the son but the feeling was not mutual. He died without having ever been married and so by rights the son should be the sole heir - unless he did something crazy like left the money to a neighbour. But over the last year he has not been contacted by the will executor. For all the son knows he is the executor but hasn't been contacted about that either... Where does he go from here? He knows the date of death and the town, does not know an address however or have contact details for any of the father's siblings or family members. How does he track down the will and/or the executor? Of course it is possible that no will was written, in which case of course the son would be the rightful heir. But what if a nephew or someone has already swooped in and claimed to be the closet living relative and taken the estate? Hypothetically in this situation, how difficult would it be to get the estate off (a nephew for example) and have it rewarded to the son? And it's been a year, what if the father's bank accounts have been cleaned out without a trace?! The son has looked at a government website to see all unclaimed property but the father's name isn't showing. Is this a cause for concern? He would have been a property owner, unless he went to a arehome. Where should the son go from here? Who should he contact? Thank you so much.

[@Simon-Misiewicz-US-UK-Taxes]

I am so sorry to hear what you are going through. The best advice I could give to you is to contact citizens advice bureau please see the website link here www.citizensadvice.org.uk/

[@Simon-Misiewicz-US-UK-Taxes]

Read our article on When do you need to pay inheritance tax (IHT) to HMRC on your death? www.optimiseaccountants.co.uk/knwbase/how-to-minimise-inheritance-tax/ Please ensure that you register for our free UK tax saving seminars: www.optimiseaccountants.co.uk/tax-seminars/

[@kohtime]

I wonder if you can clear a few things up if possible. My parents have buried there head in the sand effectively and really don’t want to deal with any of this planning at all. I’m confused as to whether when one passes there allowance over to the other parent do they retain this allowance to pass on to children? For example if my mother passed and gave her allowance of 325 my dad would have 650 allowance? Is he then allowed to pass assets up to this amount on his passing to children? Thanks for any guidance

[@Simon-Misiewicz-US-UK-Taxes]

You are correct in your analysis to a point that i wish to offer you a job 😂👍🙏

[@Simon-Misiewicz-US-UK-Taxes]

Free IHT Calculator: www.optimiseaccountants.co.uk/inheritance-tax-calculator/

[@annawong5027]

Thank for this very insightful vlog. My dad passed away in February and has left the property to my mum in his will. I've read about an extra allowance of £175,00 on top of the threshold of £325,000. But unsure as to which form I would need to complete on the HMRC website. Can you please advise? Many thanks!

[@Simon-Misiewicz-US-UK-Taxes]

There is no need at this time of it passes over to mum. Your solicitor should confirm.

[@Simon-Misiewicz-US-UK-Taxes]

Sorry to Harare about your dad. Hope you and your family are coping and have good memories

[@annawong5027]

@@Simon-Misiewicz-US-UK-Taxes Thank you for your thought and kind wishes. We're coping as much as much we can

[@annawong5027]

@@Simon-Misiewicz-US-UK-Taxes so no need to complete the form on HMRC? Will talk to their solicitor. Thanks

[@stephrfin8063]

Hello if a parent wanted to transfer the title of their property to their children whilst alive would this count as a gift? Would there be a sales transaction? Would they have to pay the 30day tax that you mentioned in the video?

[@Simon-Misiewicz-US-UK-Taxes]

Yes to all questions

[@stephrfin8063]

Thank you

[@rameshgarara1614]

I am company director&Shareholder of my own LTD. I own the business premisis in personal name which is exclusively used for trading ( it’s a clothes shop). I satisfy the trading and control critieria. Can the premisis receive 100% BPR for IHT purposes, or can it only be 50% max. I’m a bit confused about this.

[@Simon-Misiewicz-US-UK-Taxes]

It is limited to 50% but could increase this to 100%. Please book a call with us to discuss the best option from the many we can offer you,

[@intheclarts]

Can't seem to google this one... If i inherited about £1m worth of uk property, after the threshold of 500k on this and my father's residence, I'd pay around 200k. Now, do i still have to pay cgt on the increase of these rental properties too? Or cgt on any that are sold later, after the iht bill is settled? Regards

[@Simon-Misiewicz-US-UK-Taxes]

Property is transferred at market value on death. CGT is payable is the value increases from that valuation. Does that make sense?

[@tyronefrance6942]

Is it possible to simply add all your children onto your house deeds? Or put all your assets into a trust naming all your family as members

[@Simon-Misiewicz-US-UK-Taxes]

Sadly this won’t work for IHT but good innovative thinking 💭

[@coverupper1354]

Who and how is the property valued for IHT purposes? What if you don’t agree with the valuation?

[@Simon-Misiewicz-US-UK-Taxes]

That is an argument you have with HMRC. A professional valuation needs to be acquired as evidence to safeguard you from HMRCs valuation

[@coverupper1354]

@@Simon-Misiewicz-US-UK-Taxes Thank you so much with your reply!

[@Simon-Misiewicz-US-UK-Taxes]

You are very welcome and I wish you the very best of luck

[@kaieteurjohn8133]

As an only child who is also carer and POA and living in the same household for 20 years, her will favours myself, 100%. Currently the property is worth in the region of £900,000 plus other savings and shares. Can you briefly tell me my position with regards to the tax relief, as this is my sole residence. Would I have to sell the house to pay any IHT? Thank you in anticipation.

[@Simon-Misiewicz-US-UK-Taxes]

IHT reliefs could be up to £500,000 if they had no previous spouse who passed on their lifetime IHT reliefs. The excess would be subject to 40% tax. I would say that £400,000 may be such to IHT with a tax liability of £160,000. There are a lot of assumptions here so do not rely on these numbers. Seek professional advice

[@kaieteurjohn8133]

@@Simon-Misiewicz-US-UK-Taxes Thanks for your prompt reply. My father died 22 years ago and his will favoured my mother. Does your reply still stand?

[@Simon-Misiewicz-US-UK-Taxes]

Your mother is inheritance tax allowance may well have transferred over to your father. You certainly need professional advice. Please do not take any social media comment has been legitimate or final

[@Simon-Misiewicz-US-UK-Taxes]

Hi Wulf, see my comments as they are relevant and sole advice I can provide without knowing more, which is a case by case basis

[@kohtime]

Can I ask please if assets within a property of 270k get passed within intestacy to a spouse (note, no will) does this negate the 270 of the 325k nrb that could be passed on? For example in this situation would the second partner be able to pass both nrb allowances on £650k if no will was made? Also would the RNRB allowance be available from the first partner if left through intestacy? Thank you so much for your help

[@kohtime]

As im sure you have seen I asked you a similar question a few months back, the caveat being that I was unable to drag my parents head from the sand and here we are! Very fearful now that any eventual inheritance would be subject to large amounts of IHT if the 325k allowance wasn’t retained from first parent through intestacy…. Especially considering this may need to be paid before I’d have access to funds to pay it

[@Simon-Misiewicz-US-UK-Taxes]

Any assets that you transfer from one person to another on that will be subject to the inheritance tax annual exemptions irrespective if you have a will or not

[@kohtime]

@@Simon-Misiewicz-US-UK-Taxes sorry I’m not quite clear on what u mean. Do you mean she will lose the nrb she could have passed to husband if no will made?

[@Simon-Misiewicz-US-UK-Taxes]

This is a complex area. It is advisable to get some tax advise on his to avoid misinterpretation of info.

[@RidesInforests]

Its criminal it just is

[@Simon-Misiewicz-US-UK-Taxes]

100% agree with you

[@steve6375]

Thanks for intro. Would it be true to say that if you are asked to be an Executor of an estate, you should immediately say... 'I will need to know about all of your assets (property, pensions (current and pending), all online and paper accounts, assets inc. cryptocurrency, businesses, shares, debts/loans/mortgages, gifts made/received, charity donations, all incomings and outgoings, all web accounts inc. social media, blogs, websites, etc.) and be informed by you of any changes as they happen. I also need to have a copy of your current Will which should also detail how you want online accounts to be handled - e.g. Facebook, Instagram, etc.' You don't need to know exact amounts but you need to be aware that these assets/debts exist. If they are not willing to share this info then you cannot be an Executor.

[@Simon-Misiewicz-US-UK-Taxes]

I would agree with that Steve

[@765rider]

Don't think you ever answered the question in the title? I believe it's within 6 months of the death?

[@Simon-Misiewicz-US-UK-Taxes]

Not always as it get much depends on the assets and the agreement with HMRC. IHT if not extended is payable at the end of the 6 months rather than within if that helps.

[@SubjectRandom21]

So basically, it's theft.

[@Simon-Misiewicz-US-UK-Taxes]

Would you be kind enough to elaborate?

[@lawrenceheung7920]

So you literal speak is not to own property in U.K.

[@Simon-Misiewicz-US-UK-Taxes]

I am not saying that but the timing and the type is essential. Get some advice on this point