Staff Planning Seminars

Kept assets have recently been presenting to staff at retirement seminars for a major national institution.

Whilst we are aware that Wills are not high on everybody’s to do list (which they should be) we’ve been surprised at the number of retiring staff who haven’t yet considered their estate planning.

Those that have Wills are often quite shocked that having made their plans some 20 or 30 years ago (usually around the time children came along) they hadn’t foreseen the need for a regular review and update.

Times change, laws & taxes change (sometimes for the better) reviews are important.

If you, or if you are an employer, your staff would like Kept assets to provide simple, effective education on Wills, Trust planning and Powers of Attorney, please get in touch.20190810_125903 (002)

Parental Gifting Trusts for Education Fees and Other Generational Planning

So, you have decided to help your grandchildren by paying for their school and university costs. That’s a very generous thing to do and of course it will help to deplete the value of your estate so that your children will pay less inheritance tax.

But did you know that with a little more thought and planning you can also help your children with their own inheritance tax planning without affecting the original intention of fee provision and personal estate depletion.

Certain types of trust are available which if used correctly, collect the school fees from the grandparents and allow loans to the parents at no interest, in-order for them to pay the grandchildren’s fees.

The effect of such planning creates a debt on the parents’ estate which can be included when calculating their own liability to inheritance tax when the time comes.

A simple calculation of funding using ‘excess’ income by the grandparents could also negate inheritance tax immediately on those monies.

Of course, the funds committed to the trust can be used for any purpose relevant to the grandchildren’s welfare, with the trustees’ permission.

The trustees are usually members of the family which avoids the additional expense of professional trustees and their ensuing administration costs.


Simple Planning for IHT

We all know that we should have a valid Will and of course we all know that reviewing the Will regularly makes sense, don’t we?
But what about all of the other simple things that can make things easier for your family.
Take inheritance tax for example (you know the government will!).
Were you aware that each of us can make small gifts to whomsoever we choose, every year without being taxed?
A single gift each tax year of £3,000 can be placed in the hands of your chosen beneficiary and if you haven’t already given last year you can add a further similar amount.
Every time you use this gift allowance your estate can save £1,200 in inheritance tax. That’s £2,400 per couple or if you haven’t given before £4,800 per couple of tax saved just this (including last) year. That’s a reasonable first car or the start of a house deposit.
Is there a wedding coming up? wedding or civil ceremony gifts of up to £1,000 per person (£2,500 for a grandchild or great-grandchild, £5,000 for a child) also pass by the inheritance tax trap.
If you can afford the annual gift you might also like to give as many smaller gifts of up to £250 to as many people as you like each year on top.
Luckily for some, the amount of income that a person receives each year that isn’t used and, importantly, would not affect their normal lifestyle, if given away, can be diverted to chosen beneficiaries without suffering any further taxes.
You can also make much larger gifts either directly to individuals or, in a more limited fashion, to trust. However, such large gifts only become tax efficient if the giver (donor) survives a full 7 years.
Take care though, any large gifts made the past 7 years might be caught together with the new gift if the donor dies early.
And make sure that you cannot benefit in any way from any large gift you might make. Reserving any kind of benefit can completely negate your good planning intentions.
Make notes, keep proof, be certain.
So those are the simple things. For anything more complicated, drop us a line.
Kept assets
Pass it on…….

Changes to Probate Fees

Courtesy of the Society of Will Writers Trust Company
Last May the Ministry of Justice proposed the introduction of increased probate fees on a tiered system based on the deceased’s assets. This tiered system confirmed that lower value estates, up to £50,000 would be exempt from probate fees whereas those with assets of more than £1m will have to pay probate fees of between £8,000 and £20,000. Due to the General Election the plans were shelved as the Ministry of Justice concluded there was no time to pass the necessary legislation prior to the Election.
Yesterday, it was announced that the plan would be revisited. Few details have been revealed but we are advised that the fees would never be more than 0.5 per cent of the value of the estate.
The current probate fees are fixed at £215 where an estate value is more than £5,000 (or £155 for those applying through a solicitor). With the new proposed increase, an estate value of £250,000 would see a probate application fee of £1,250 – nearly six times more than the current fixed application fee.
HM Land Registry data in August this year reveals that, on average, house pricess have risen by 0.2% since July 2018 and an annual price rise of 3.2% – which makes the average property in the UK valued at £232,797.

From April 2019 if an estate is higher than £50,000 probate fees under the progressive fee regime are:-
· Estates worth less than £50,000 will pay nothing, meaning estates worth between £5,000 and £50,000 will save £215 compared to the current system.
· Estates worth from £50,000 up to £300,000 will pay £250, a rise of £35.
· Estates worth from £300,000 up to £500,000 will pay £750, a rise of £535.
· Estates worth from £500,000 up to £1 million will pay £2,500, a rise of £2,285.
· Estates worth from £1 million up to £1.6 million will pay £4,000, a rise of £3,785.
· Estates worth from £1.6 million up to £2 million will pay £5,000, a rise of £4,785.
· Estates worth more than £2 million will pay £6,000, a rise of £5,785.
The above fees apply in addition to any Inheritance Tax and other administrative costs that the estate would otherwise be liable for.
For more information call us or complete the contact page.

#Pass it On

Kept Assets Featured on Local Radio

Kept Assets Director Richard Hayes was recently interviewed by local  station 4LEGS Radio.

In a broadly based chat, Richard emphasised the importance of Wills, Trusts and Lasting Powers of Attorney.

you can listen to the whole interview at: