17 December 2009
Tips for maximising inheritances offered
In order to minimise inheritance tax liability, people should avoid holding on to all their possessions and distributing them in their wills, it has been suggested.
Writing in the Independent, Kate Murphy from moneysupermarket.com pointed out that gift allowances can be taken advantage of.
Such offerings reduce the size of people's estates, meaning the government receives less and their friends and family get more.
She commented: "Any assets you give away will fall out of your estate for inheritance tax purposes after seven years - they are known as 'potentially exempt transfers'."
Ms Murphy went on to say that some cash gifts fall out of estates immediately.
For example, wedding presents worth up to £5,000 given by parents come under this category, along with similar offerings from grandparents up to the value of £2,500.
Recently, the Way Group revealed it had received a rise of one-fifth in the number of inheritance tax enquiries made by consumers in the three months ending in November.