The most significant asset of an estate can often be a family home or property, especially as housing prices continue to rise. If you live with a spouse or civil partner, the organisation of your property ownership can have an important effect on how much inheritance tax you may be liable for.
If you are joint tenants then, when one of you passes away, the joint asset will pass entirely to the survivor without being subject to inheritance tax. However, if you are tenants in common, then you can each bequeath your share of the property separately and as you choose, which can affect how much inheritance tax needs to be paid.
For example, the share of the property could be given directly to a child, avoiding a higher IHT tax on the surviving spouse's estate when they pass away – or alternatively it could be put into a trust, allowing the surviving spouse to continue living in the property and then, on their death, paying out to the beneficiaries.
For more information on tenants in common inheritance tax and other matters involving your estate and whether it will be taxable, fill out our online enquiry form and we will put you in touch with expert UK financial consultants who can offer you a free, no obligation first consultation.