Contents
Don't leave it to chance
Family tax planning
Tax payback - tax credits
Pay rise for the other half?
Jam today, or jam tomorrow?
Pension payments and tax relief
Employee pensions
Children's pensions?
Borrowings and tax
Investment limits
Employee cars and fuel
Give generously and save tax
Capital gains
Capital losses
Second homes
Company or trade?
Inheritance tax
Children's savings?
Business tax
Two jobs = too much NIC?
Should VAT be flat?
Mutiny and bounty
One careful owner
A matter of trust
|
For some years, a number of plans have been available to reduce the impact of inheritance tax, particularly on the value of houses. The idea has been to take the house out of the owner's assets chargeable to IHT, but still to allow occupation. Several of these plans have been held to be effective by the courts, and the Revenue have had to close the stable door each time after many horses (or houses) have bolted. On 6 April 2005, a new and highly complicated set of rules will come into effect to try to remove the advantages of these plans. Instead of charging IHT on the value of the house when the occupier dies, they will instead want to charge income tax each year on the benefit of living in it. One of the ways to avoid the income tax charge will be to choose to pay IHT instead - in effect, running back into the stable. The scope of these rules is very wide. If you have ever put into effect an IHT-saving plan which involved giving something away but continuing to enjoy it, you should take advice about whether you are affected. You may also be caught if you have given money to someone else so they can buy an asset which you enjoy - and it is not just houses that are caught, but also other assets and investments in trusts. It is hard to see how the Revenue can police all the different possible situations which are caught, but they are likely to be aware of the most obvious - the house plans which were specifically intended to avoid IHT. If you think that you might be subject to these rules, you should take advice promptly to see if you need to take action before 5 April 2005.
| ||||
© Bayar Hughes & Co., 2010.