Tag: IHT

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Inheritance tax Review will Uncategorized Wills

Inheritance Tax and Domicile

It is important to review wills regularly to take into account, amongst other things, any changes in legislation.

Currently, UK Inheritance Tax is a domicile-based system. A government Policy Paper originally published on 29th July stated that the government intends to replace this with a new residence-based system from 6 April 2025. Another document published by the government on 31st July stated that officials will seek further feedback through a series of separate engagement sessions on Inheritance Tax with confirmation of the final design of these policies to be published at Budget.

The next Budget is due to take place on 30th October 2024.

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Inheritance tax

UK Inheritance Tax – Autumn Statement 2022

Today, the Chancellor of the Exchequer set out that the inheritance tax nil rate bands will stay fixed at current levels until April 2028.

The nil rate band will continue to be at GBP 325,000. The residence nil rate band will continue to be at GBP 175,000. The residence nil rate band taper will continue to start at GBP 2 million.

This is subject to legislation being passed.

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Executors Review will Trusts Uncategorized Wills

6 occasions to review your will

What follows are 6 occasions on which you should review your English and Welsh will.

  1. Marriage
    If you marry, your existing will is automatically revoked. This is unless your will was written in contemplation of that marriage and an appropriate clause is included in the will to state this.
  2. Divorce
    If you divorce, any gifts in your will to your former spouse or civil partner are made void. Also void are any appointments of them as an executor, trustee, or guardian. You should also review your will planning if a beneficiary of yours divorces or is in the process of going through a divorce.
  3. Sell or move home
    A home, for many people, is their most valuable asset. If you no longer own that asset it is a good idea to review your will – you might want to leave a different asset to your beneficiaries instead. Also, if you store your will at home, it is important that it does not become lost during the move!
  4. Change in family circumstances
    Relationships change over the years and unfortunately friends and family we were once close to may drift away or die. On a happier note, new potential beneficiaries are born, new relationships formed, and previous relationships repaired. Your will should be reviewed as your circumstances change.
  5. Change in the law
    If tax law changes and your will isn’t kept up to date your estate may end up paying more inheritance tax (IHT) on your death. For example, in 2017 there was a change to UK IHT which introduced the residence nil rate band – an IHT allowance that can be available where your home is gifted to your children (or other direct descendants). If your will contains provisions that create a trust on death, it is important to review these if trust law changes.
  6. Every 3 to 5 years
    Review your estate plan every 3-5 years to make sure that your will still matches your current wishes.