There is a widespread perception that using a trust can help someone avoid inheritance tax (IHT). This is not strictly true, although trusts can help with IHT mitigation when used properly. Part of the confusion lies in the wide range of trust types that exist. In this article, our financial planning team at WMM offers a brief overview of the main varieties that exist in 2021, and how they can be used in estate planning.
Did you know that after World War II, the UK government raised inheritance tax (IHT) by 80% and then went as high as 85% in 1969? These figures are much higher than the 40% levied in 2020 on the value of an estate exceeding £325,000. Yet questions have been raised in the press about whether IHT may be in the Chancellor’s sights as we approach the autumn budget.