When Mark Twain said death and taxes are always with us, he was only half right. Speechly Bircham has devised a new way of avoiding inheritance tax (IHT) which can potentially reduce the tax bill to nil.
Speechly Bircham's well-known Wealth Protector Wills already allow married couples to make large IHT savings for the benefit of their children.
But many people who inherit from their parents have already built up wealth of their own. Naturally, the inherited funds are very welcome – but they in turn create a potential IHT headache. How can the family enjoy the inherited wealth without paying IHT on it?
The Super Wealth Protector
The answer is by taking advantage of Speechly Bircham's new Super Wealth Protector Wills.
Everyone knows we each have an IHT-free band, currently £325,000. Much less well-known is that with careful planning you can generate an almost unlimited number of tax-free bands for the benefit of your family after your death.
In the past this opportunity was nearly always wasted. But the Super Wealth Protector now allows you to take full advantage of it.
This is how it works...
The Super Wealth Protector enables you to create a series of family funds for the benefit of future generations. Each family fund is potentially an IHT-free zone.
The funds are highly flexible. Family members can borrow from them or use the assets from the fund in any way at any time.
Here is what it saves...
Consider Julian, who is 55 and has two children at university. His parents are elderly, and he stands to inherit £1 million after IHT on their death. Julian and his wife are already worth over £1 million.
Ignoring any growth in the value of the assets inherited from his parents, Julian's £1 million inheritance will suffer £400,000 IHT on his death. So his children will only receive £600,000 of the original £1 million.
But if Julian's parents make Super Wealth Protector Wills, the entire £400,000 IHT bill on Julian's death could be avoided. He can have access to the funds during his lifetime, but so that his children can receive the entire £1 million tax free. And if, later on, Julian's children retain the family funds for their own children, Julian's grandchildren will also inherit far more.
The Super Wealth Protector can be used both by married couples and unmarried individuals. The tax savings it can generate are potentially unlimited.
And there are other benefits, as Super Wealth Protector Wills help to protect the family wealth from other threats. These include remarriage, divorce, mental incapacity, and the financial immaturity or vulnerability of beneficiaries.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.