Want inheritance tax planning advice? Read our IHT Guide

Monday 15 March, 2021

Tracy Dove, Financial Adviser in Basildon and Cheshunt, Hertfordshire reviews our new Inheritance Tax (IHT) planning guide and provides information on how you can use your inheritance tax allowance. The IHT guide provides information about:

  • What is IHT? 
  • When you have to pay IHT
  • Ways that you can mitigate IHT

Don’t put off discussing your inheritance tax planning, talk to one of Thomas Oliver’s inheritance tax specialists today. Call our financial advisers now on 01707 872000 for personalised inheritance tax advice.

What is IHT?

Viewed mainly as a tax that only the very wealthy would expect to pay, IHT is frequently misunderstood or ignored, and as a result, is catching more families out every year. For example, in the 2019/2020 tax year, HMRC collected £5.2 billion in IHT receipts. By 2023, the annual amount collected in IHT is expected to pass a staggering £6 billion*. This means that IHT is affecting thousands of bereaved families who were unaware that their inheritance would be drastically reduced. 

What to do if you need inheritance tax planning advice?

Tracy Dove, Financial Adviser in Basildon and Cheshunt, Hertfordshire said: ‘The good news is that if you read our guide you don’t have to become part of that statistic, you can review your inheritance tax allowance and do some inheritance tax planning. If you want to leave behind an inheritance for your family, there are lots of options available to you which will allow you to reduce the amount of inheritance tax they are required to pay. With careful, considered estate planning, you may even be able to reduce the IHT liability on your estate to zero. We explain some of the IHT planning opportunities available to you in our easy- to-read guide. Choosing the right options for you and your family will depend on your personal circumstances. However, don’t worry, just call one of our Thomas Oliver financial advisers who will be able to talk through your issues and answer any questions you may have.’

Who Pays IHT?

Your ‘estate’ essentially means everything you own. This includes your home and other properties, any savings or investments, and also any life insurance policies held in your name. 

When you die, the total value of your estate will be added up, minus any debts or liabilities you owe (such as credit card debt, loans or mortgages). 

If your estate is valued at less than £325,000 (known as the ‘nil rate band’ or ‘NRB’), there is no IHT to pay, and the estate can be passed to your beneficiaries IHT-free. 

However, if your estate is valued above £325,000, your beneficiaries may be expected to pay IHT at a rate of 40% on everything over that threshold. This depends on whether any other allowances, exemptions or reliefs are available. 

If you leave at least 10% of your estate to charity, HMRC reduces the rate of IHT on the rest of your estate to 36%. 

It is important to remember that the IHT due on your estate is paid by your beneficiaries (the people you choose to leave your estate to). They must pay the IHT bill within six months of your death being recorded.

How can you mitigate IHT?

You can always give your money away to reduce the value of your estate. It makes sense to understand the rules around gifting, so you and your beneficiaries don’t get caught out.  Below are some of the ways you can mitigate IHT but for more information please read our Inheritance Tax Planning guide.

Life Insurance Policies

Use life insurance policies to plan ahead for an IHT bill. There are two types of policies that give you this option: whole of life policies and term insurance. 


If you are uncomfortable with the idea of giving away large sums of money, setting up a trust can help ensure your assets are passed down the generations in a more careful and considered way. 

Equity Release

With many older homeowners finding themselves ‘asset rich, cash poor’, equity release schemes have grown increasingly popular. 

Business Relief

Business Relief (BR) is an increasingly popular and effective way to reduce or eliminate a future IHT liability for your beneficiaries. 

Individual Savings Accounts (ISAs) 

ISAs are known for being tax-efficient, but did you know that your ISAs could form part of your taxable estate for IHT purposes? 

Tracy Dove, Financial Adviser, Hertfordshire continued: ‘Our IHT guide includes examples of how to compare the different options to reduce your inheritance tax bill so it can help guide conversations with your family when considering the best planning options to suit your needs. However, if you are looking for an inheritance tax specialist who will offer you personalised financial advice please call our Thomas Oliver financial consultants on 01707 872000. We offer a free initial IHT consultation, so you know the best financial options for your circumstances. As well as reducing the amount of IHT your beneficiaries are likely to pay, we recommend that you write a will and keep it reviewed and up to date, this enables you to determine what happens to your estate.’

Please note: The Financial Conduct Authority does not regulate tax advice, estate planning or will writing.  

Your Guide to Inheritance Tax Planning

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