Your Will and Inheritance Tax
10th Feb 2017
If you haven’t done it for some time can I suggest that it may be time to review your Will.
In April this year the Government is introducing some additional tax free allowance available on death known as the Residential nil rate band.
Currently the existing ‘nil-rate band’ (the amount of your estate that will not be taxed after your death) is set at £325,000. This will now be supplemented by the ‘main residence nil-rate band’, which adds an additional tax-free allowance of up to £100,000 for deaths on or after 6th April 2017. Taking into account the existing nil rate band, this means that moving forward by 2021 there may be some people who will have a total tax free allowance of £500,000.
You won’t be surprised to know that there are conditions on qualifying for the main residence nil-rate band, in particular:
- You may only claim the allowance against a residential property which forms part of your estate and has been your residence at some point;
- The residence must be left to one or more of your direct descendents on your death;
- If your estate is worth more than £2million then you may not qualify for the additional allowance
- The amount of the allowance will be staged – £100,000 for 2017/18; £125,000 for 2018/19; £150,000 for 2019/20; and £175,000 for 2020/21.
We would always recommend regularly reviewing your will. We still see clients who have current Wills prior to 2007 who have complicated trust arrangements which may or may not be the most cost effective way of dealing with your affairs.
If you have any questions or wish to review your will, we are always here to help. Please call Victoria, Charlotte, John or Philippa on 0161 928 3848 or email email@example.com.