Wealth management ‘could be essential to avoid excessive tax charges’

Posted 21/01/2011

People in the UK may wish to employ methods of wealth management if they are to avoid passing on large inheritance tax (IHT) bills to their children.

This is the advice of Neil Edwards, a tax solutions expert who told FTAdviser.com he had recently found that parents currently plan to leave an average of £335,000 to their children when they die.

However, this is £10,000 above the current threshold for IHT, meaning offspring may be exposed to a 40 per cent tax on some of the assets.

Calling IHT planning an increasingly common headache, Mr Edwards recommended seeking the counsel of an expert such as an experienced solicitor in order to avoid such levies.

He pointed out that “while giving amounts to children before you die is one way of dealing with this, there are other solutions of which many parents are not aware” until they consult professional advisors.

This follows a recent poll by the Janus Capital Group, which found that 48 per cent of those surveyed said they are unsure about how much their offspring will inherit.