Inheritance tax is affecting a growing number of people and is not just an affliction of the rich, despite many people mistakenly thinking that this is the case.
Continually rising house prices mean that an increasing number of people are falling within the clutches of inheritance tax
, according to financial services company Edward Jones.
Furthermore, not having a Will in place at the time of death can lead to various legal complications which can result in the taxman ending up with even more than the inheritance tax which is payable on a property.
Edward Jones is urging people to take stock of how much their property is worth and to calculate the best way in which to benefit beneficiaries by limiting their exposure to inheritance tax.
"Many people don’t realise how much their estate can amount to once everything is taken into account – house, car, possessions, savings, shares, jewellery and so on." said Paul Simmonds, a stockbroker and financial adviser with Edward Jones.
"It’s very easy for an estate to be worth a lot more than the current £300,000 inheritance tax threshold, with tax charged at 40% on everything above this limit. So, for example, a single person with an estate worth £500,000 would leave a tax liability on the balance of £200,000, meaning £80,000 would have to be paid before the estate was released to beneficiaries.
"It’s also wrong to assume on death everything passes to ones nearest and dearest. This is often simply not the case. However, interests can easily be taken care of by making a Will and taking advice. It is simple, inexpensive and can also help limit any inheritance tax liability."
© Fair Investment Company Ltd