If you consider that your estate perhaps have to pay Inheritance Tax, there are 5 different ways to avoiding inheritance tax in the UK, and not all of them involve changing of your will.
- Gift It All To Your Partner
You can avoid the inheritance tax in the UK by giving away all your assets, changing your will or simply setting up a trust. You need to ensure that you pay attention to all the legal details.
If you have a civil partnership or are already married, you can give anything you own to your civil partner or spouse, so that your estate will not have to pay any Inheritance Tax on what the gift is worth.
The rules may be different if your civil partner or spouse’s permanent home is outside the UK.
- Get Some Money Saving Tips
You can ask professionals over the Internet for assistance in this regard. Some of the services would like you to subscribe to them for more advice and tips. They will certainly share free newsletters that are packed with appropriate guidelines that would help you learn more on how to avoid inheritance tax in the UK.
- Give It To Friends Or Family
If you give something to your family members for friends who are not your civil partner or spouse, so that you no longer acquire any benefit from it, the value of the gift will be still included in your estate for Inheritance tax, but just for 7 years.
You can give away certain amounts every year and as a result you do not have to pay for the Inheritance tax.
- Put Your Things Into a Trust
If you consider putting some of your property, cash or investments into a trust, they no longer become a part of your estate.
For instance, you could set up a trust that would pay for your grandchildren’s education, or you could support a family member with a disability.
You can establish a trust in your will or can set up one immediately. The rules related to trusts are complex so make sure you consult experts in this regard. Bear this fact in mind that some of the trusts perhaps have to pay Inheritance Tax themselves.
- Take Out Some Life Insurance
In case you take out your life insurance cover, it will not reduce the amount of Inheritance tax due on your estate. However, the payout may make it easier for your surviving family to pay the bill.
Eventually, you will be able to prevent your family home from being sold. However, if you do this, ensure the life insurance goes into the trust, if not, and then it is going to make your estate bigger and will be required to pay more tax.
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