I nheritance tax is a kind of tax that you will have to be paid for anything that is left back after your death. This is a kind of tax imposed by the government over anything that you leave for your heirs. The word estate here refers to all the belongings and even trusts or gifts made at the time of death. The tax is payable for a total of all the belongings and a certain part of the belongings that you share with someone else.
This is not applicable for everyone who passes over property, but only if the value of the belongings is over 325,000 Euros. Most of the inherited estates do not have a tax liability over it as the amount does not total to 325,000 Euros. For the amount above this threshold limit, the tax is charged at 40%. Property, insurance, investment, pension plan or employee death benefit, cars, jewelry, gifts made in the last two years, trust and other sources of personal benefit, all come under the taxable assets which are taken into consideration for calculating inheritance tax.
It is very essential that you plan the management of your assets and properties before your deaths so that the IHT on them may not become a burden for your family after your death. Some people make a major mistake by leaving all the assets to the spouse. This might seem to be a good move, but will create more IHT when passed over to the children after the death of both the other parent too. This makes it necessary to take wise decisions regarding IHT so that it can be completely avoided or at least reduced. The tax experts in Aslam and Co, are well versed and experienced in dealing with taxation and will give you guidance about the ways to reduce you inheritance tax by making use of the ‘nil rate band’ and other aspects.
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