Rearranging assets can “obviate inheritance tax”

Speaking to a financial advisor and rearranging assets can help minimise the amount of inheritance tax families will have to pay, the independent financial advisory Calculis has said.

There are uncomplicated ways of planning finances, such as placing funds into a trust, allowing consumers to still derive an income from the money, according to the company.

Calculis director Alex Pegley says: “There are various trusts that can be used – one can invest in qualifying investments that you hold personally but after two years are not susceptible to inheritance tax.”

People should be aware that not everyone must pay inheritance tax after the death of their partner. It only applies if the estate is above the £312,000 nil rate band and it does not affect people who receive it from their wife, husband or civil partner if they are both domiciled in the UK.

Only in the event of the estate being worth more than this is are the assets taxable if one partner dies.

Tags: band, law, asset, Taxation in the United Kingdom, Civil partnership in the United Kingdom, GBP

Danger of only investing in your home

We are being warned that we could be setting ourselves up for a fall by investing almost all of our money into a single property.

That is according to a report which states that almost two-thirds of us are running the risk of financial ruin by investing too heavily in a single asset.

Researchers at Durham University have discovered that as many as 62 per cent of us invest the majority of our money in a house and could face real difficulties if a housing market drop, like that seen in the late 1980s, were to take place.

“This study really draws attention to the precarious position of the majority of English homeowners’ savings,” said Susan Smith from the university.

“While many would think it strange to invest everything they have into one particular company, to all intents and purposes more than seven million people in England are doing just this by ‘banking on housing’.

“In fact, they are investing almost everything they have into just one building, in one neighbourhood, in one town, in one region, despite the hindsight of a recent housing market collapse,” she added.

The research found that 30 per cent of people take out a mortgage but do not see their home as a way of storing and accumulating wealth.

This apparent lack of vision when it comes to the housing market is even more alarming when you realise that 59 per cent have no other savings or investments to fall back on.

Homeowners are being advised to ensure that they have some secondary savings.

Tags: collapse, asset, fact, realise, property, university, home insurance