As the United Kingdom's leading accounting firm, Everest and Co Accountants is dedicated to providing exceptional financial services that help individuals and businesses achieve their financial goals. In this blog post, we will explore an IHT key updates on our internal memo that discusses the potential benefits of owning a let property and how our expert team can assist you in optimising those advantages.
Unlocking the Full Potential of Your Let Property
The article highlights the notion (on accounting-web) that owning a let property allows you to have your cake and eat it too - combining the benefits of buy-to-let properties with potential inheritance tax (IHT) savings. This compelling option can be an excellent source of long-term income and a means to secure financial stability for your loved ones.
Understanding IHT and Let Property
Inheritance tax is a topic that often features in financial planning discussions. While it may seem complex, Everest and Co Accountants are here to simplify the process for you. Proper planning can help minimize the tax burden on your estate, ensuring that your loved ones receive the maximum benefit from your legacy.
Typically, IHT is charged on the total value of an individual's estate at a rate of 40% above the IHT threshold. However, as the article explains, if you own a let property, you may be eligible for certain tax reliefs, such as Business Property Relief (BPR) or Agricultural Property Relief (APR), which can significantly reduce or eliminate IHT on your property.
Additional Information to expand on above key terms: IHT Tax Planning
Inheritance Tax (IHT) is an important consideration for individuals with significant assets. It is a tax levied on the value of your estate upon your death, potentially diminishing the amount that your loved ones will inherit. However, strategic tax planning can help mitigate the impact of IHT and ensure that your assets are distributed according to your wishes.
Here at Everest and Co Accountants, we offer comprehensive IHT tax planning services to help you minimize your tax liabilities and protect your wealth for future generations.
Key aspects of IHT tax planning include:
1. Utilizing the IHT Nil Rate Band:
The IHT Nil Rate Band represents the amount of your estate that is exempt from tax. Currently set at £325,000 per individual, this allowance may be transferred between spouses or civil partners, effectively doubling the threshold to £650,000. Understanding and utilizing this allowance is essential to reduce the amount of IHT payable on your estate.
2. Exploring Business Property Relief (BPR):
BPR can provide significant tax relief for individuals who own qualifying business assets, including certain let properties. Depending on the circumstances, BPR may provide a 50% or 100% relief on the value of these assets, potentially reducing the overall IHT liability on your estate. Our team of experts can guide you through the complex qualification criteria and help you determine if your let property is eligible for this relief.
3. Consideration of Agricultural Property Relief (APR):
If you own agricultural property, such as farmland or farm buildings, you may be entitled to claim APR. Similar to BPR, APR can provide substantial tax relief on the value of these assets, potentially eliminating the need to pay IHT. Evaluating the suitability of APR for your specific situation requires expert knowledge and attention to detail, and our team is well-equipped to assist you.
4. Trusts and Lifetime Gifting:
Trusts can be an effective tool for IHT tax planning. By transferring assets into a trust, you can remove them from your estate while still retaining control over their use and distribution. Trusts can offer flexibility, allowing you to support beneficiaries during your lifetime while reducing the potential IHT liability on your estate. Additionally, gifting assets during your lifetime can be an effective way to gradually reduce the value of your estate subject to IHT.
Expert Help and Guidance from Everest and Co Accountants
At Everest and Co Accountants, our team of experienced professionals specializes in complex tax planning strategies. We understand the intricacies of the tax system and are well-versed in identifying and leveraging tax-saving opportunities for our clients.
Whether you're a landlord looking to optimize the potential benefits of your let property or an individual interested in understanding how IHT relief may apply to your estate, we're here to guide you through the entire process.
Our tailored services include:
1. Comprehensive estate planning: We can assess your current estate, identify potential risks, and devise a personalized strategy to minimize the impact of IHT on your assets, including let properties.
2. Tax-efficient structures: Our team can help you explore options such as setting up a trust or incorporating your property portfolio, which may offer additional tax benefits and IHT relief.
3. Compliance and reporting: With our expertise, you can rest assured that your tax reporting obligations will be met accurately and on time, allowing you to stay focused on the growth and development of your let property portfolio.
Contact Everest and Co Accountants Today
Unlock the full potential of your let property while securing its long-term benefits for your loved ones. Contact Everest and Co Accountants via phone at 01902219680 or email at info@everestandco.co.uk to discuss your specific requirements and gain personalized expert advice.
Conclusion
Owning a let property offers a plethora of financial advantages, including potential income and opportunities for IHT relief. Understanding the complexities of IHT and utilizing the available tax reliefs can help ensure that your hard-earned assets benefit your loved ones to the fullest.
With Everest and Co Accountants by your side, you can navigate the intricate landscape of tax planning and maximize the advantages of your let property. Allow us to streamline the process for you, making your financial journey smoother and more rewarding. Contact us today to embark on a successful and tax-efficient property ownership experience.
Mr Ketan Tailor on 17.07.2023