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Mullen Stoker

Mullen Stoker

Chartered Accountants in Durham

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Inheritance Tax

Inheritance Tax (IHT) is due when a person’s estate (their property and possessions) is worth more than £325,000 when they die. This is called the ‘IHT threshold’.

The current rate of IHT is 40% on anything above the threshold. The rate may be reduced to 36% if more than 10% of the estate is left to charity.

Who pays Inheritance Tax

Usually the executor or personal representative for the person who has died pays IHT using the funds from the estate.

Trustees are responsible for paying IHT on trusts, which are a way of looking after assets (money, investments, land or buildings) for people. A trustee is a person who looks after the trust.

If you’ve got an inheritance or a gift from someone who has died you only owe IHT if their estate is more than £325,000 and either:

  • it says in the will that you should pay Inheritance Tax
  • the deceased’s estate can’t pay it

There are certain reliefs from IHT. These include estates that include certain business assets or agricultural property.

 

It is also possible to reduce any IHT due on death by reorganising your estate while you are alive. This can be done with the use of trusts or by gifting assets. As you can imagine there are complicated rules that set out how these strategies can be used. Additionally, any assets left to your spouse or civil partner (providing they are UK domiciled) are exempt from IHT.

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ABOUT US

We bring a fresh, dynamic and friendly approach to Accountancy services. We are proud to say you will not find Mullen Stoker to be a stereotypical Accountancy Practice as we have new ideas, add value to what are known to be more traditional accountancy services and are able to provide high quality IT Solutions

We use telephone tracking numbers to link a user’s call to the marketing channel that they originated from. This is done using cookies, you can choose to decline cookies using your browser settings if you would prefer not to be tracked. We may record calls for training or monitoring purposes.

This firm is not authorised under the Financial Services and Markets Act 2000 but we are able in certain circumstances to offer a limited range of investment services to clients because we are members of the Institute of Chartered Accountants in England and Wales. We can provide these investment services if they are an incidental part of the professional services we have been engaged to provide.

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