How to Save Inheritance Tax in UK and Tax avoidance
6 Best ways to avoid Inheritance Tax and Save a great Fortune.
In this busy world when you work all the life to make a fortune and thinks to handover to your children but inheritance tax make your alarm and you think of Tax avoidance. So today in this article I am going to tell you some awesome ways through which you can calculate your tax and can claim on various exemptions to reduce on your taxes. you may also check the excellent guide to save IHT
1. A great Will:-
The first and best thing which you can do for your successors is to make a will assign everything important to your heir. Because if you have not made a will your assets will be distributed according to the government law and your family will lose a great sum! so be aware of it.
2. Give away your Assets:-
It will be good if you devote your assets in your life to your children. If you give assets to your children and survive for the next 7 years then it will be good in terms that inheritance shall be tax-free and they are as gifts. but unfortunately, if you die within 7 years then the tax shall be paid on reducing scale. You can also give £5,000 worth gifts on your child wedding and £3,000 each year which will be absolutely tax-free.
3. Build a Trust for Your Assets:-
When you put assets in a trust then it will not be considered as your heir and you can benefit your children on that basis till they are 18. you may check the book first chapter page 8 for details.
4. Life Insurance:-
Well, this is an awesome suggestion to take a life insurance policy. In which a good sum shall be paid by the insurance company to your children. You can take this policy and use it as potential inheritance tax bill and then assign this policy to your trust then it will be paid outside of your assets.
5. leave something for Charity:-
If you leave something for charity and it is 10% of your assets then you can save up to 36% of inheritance tax. Anything in the charity is free of tax liability.
6. Make out Gifts of Excess Income:-
you can make gifts for your family without inheritance Tax liability but, be sure they are part of your original expenditure without degrading the standard of life. Through this, you can save a great fortune for your children and they shall remember you!
This article is written independently while the content is searched for Inheritance tax across the internet and some trustworthy websites.