Research conducted by an investments firm has revealed that a third or more of parents are cautious of leaving their estate to their married children in case the children divorce.
Their main concern was that they did not want any of their estate reverting to their children’s former partners in the event of a divorce. So instead of making a will and conducting careful inheritance tax planning to maximize their estate for their loved ones, many parents are instead burying their heads in the sand, resulting in hefty and avoidable payments being made to the tax man instead.
However, recent court rulings on the legal enforceability of pre-nuptial agreements should assist as parents can insist on their children putting one in place in order to benefit from their wills.
If an estate is worth more than £325,000 it is important to take measures to minimise inheritance tax liabilities, for example by making cash gifts whilst alive or setting up a trust. A private client solicitor can provide comprehensive tax planning solutions.
The Chancellor has also introduced in the recent budget a 10% inheritance tax relief for those who give at least 10% of their estate to charity.
By Wills and probate solicitor, Rob Gore