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The most flexible way in which you can draft a will is to leave the whole of the estate on a trust for a wide class of beneficiaries. Those beneficiaries will typically include the deceased’s spouse, children and grandchildren.

The advantages

  1. You can leave instructions to the Trustees asking them to distribute your estate according to the needs of the beneficiaries.
  • You can save a lot of time when reviewing and amending your will during your lifetime, as and when circumstances change.
  • Take advantage of the “uplift” in the base cost of the assets. This means that the beneficiaries will inherit assets at their probate value for capital gains tax purposes.

Inheritance Tax & leave

Nil rate bands (NRB)

NRB is the threshold, currently £325,000, below which some, or all, of the value of a gift, a death estate , or assets held within a trust is subject to an Inheritance Tax rate of zero.

If an individual dies, leaving some or all of their nil band unused, a claim can be made for the unused proportion  to be transferred to the spouse or civil partner.

Overall, the NRB can be worth £650,000 which means your estate would not be exposed to Inheritance Tax at death if your total estate value is less than this.

Residence Nil Rate Band (RNRB)

RNRB (currently £175,000) is available where you pass your main residence to children, grandchildren, great-grandchildren etc. via the will. This is in addition to NRB.

Again, if an individual dies leaving some or all of their RNRB unused, a claim can be made for the unused proportion to be transferred to the spouse or civil partner.

In total, the combined NRB and RNRB is worth £1 million per married couple. Contract us if you wish to discuss your will or to consider any Inheritance Tax planning, which can be beneficial.

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