Wills and Probate Solicitors

Inheritance Tax (IHT) planning has always been crucial in managing one's estate, but its importance has skyrocketed in the current era of stealth taxes. At Duncan Lewis Solicitors, our dedicated Wills and Probate team is here to help you strategically draft your will, ensuring your loved ones receive the maximum benefit from your estate.

Key Tools in IHT Planning

Nil Rate Band (NRB) and Transferable NRB (TNRB): The NRB, set at £325,000 and frozen until 2028, is a fundamental component of IHT planning. Additionally, any unused NRB from a late spouse can be transferred, effectively doubling your allowance and easing the tax burden on your estate.

Residence Nil Rate Band (RNRB): Designed to reduce IHT on family homes, the RNRB is fixed at £175,000 until 2028. However, for estates valued over £2 million, this allowance tapers off, affecting estates up to £2.7 million or more.

Spouse Exemption: Utilising spouse exemptions through outright gifts or life interest trusts can be invaluable. These mechanisms allow assets to pass between spouses without immediate IHT implications, providing flexibility and potential future tax benefits.

Business and Agricultural Property Reliefs (BPR & APR): These reliefs offer significant IHT savings and are often best utilised through trusts upon death rather than direct inheritance by a spouse. This strategy can "bank" reliefs and protect them from future changes in business or tax law.

Charitable Contributions: Leaving 10% of your estate to charity can reduce the IHT rate to 36%. This relief is often overlooked but can substantially increase the net estate's value after tax deductions.

The Impact of Stealth Taxes

The freezing of key IHT thresholds is a deliberate strategy to increase IHT revenue. With property and asset values on the rise, more mid-sized estates are becoming liable for higher IHT bills. This reality underscores the necessity of proactive and expert IHT planning.

Residence Nil Rate Band Considerations

For those with property and descendants, understanding and optimising the RNRB is essential. Properly structured wills can ensure that the right property interests qualify for this allowance, potentially saving significant amounts in IHT.

The Importance of Flexible Wills

While simplicity in will drafting is often desirable, it can overlook opportunities for IHT mitigation and adaptability to changing circumstances. Flexible wills, complemented by a letter of wishes, allow executors to adjust strategies posthumously in response to new tax laws or personal situations.

Trusts and Variations

Discretionary Trusts: Implementing a Discretionary Trust for the NRB, TNRB, and RNRB on the first spouse's death can optimise the use of these allowances, shielding assets from IHT on the second death.

Business and Agricultural Assets in Trusts: Incorporating BPR & APR assets into trusts upon the first death secures these reliefs, protecting against future business changes or tax law amendments.

Flexible Immediate Post-Death Interest (IPDI) Trusts: These trusts claim spouse exemptions while allowing for post-death planning. Assets can be distributed flexibly, potentially reducing IHT if the surviving spouse lives for another seven years.

Tailored Trust Solutions

Clients should carefully consider the best approach for leaving property in trust. Options like life interest, right to occupy, discretionary trust, or outright gift each have distinct IHT implications. Our team at Duncan Lewis Solicitors provides bespoke advice to navigate these complex decisions, ensuring optimal outcomes for each unique situation.

Conclusion

In an era of increasing IHT burdens, the expert Wills and Probate team at Duncan Lewis Solicitors offers comprehensive planning and strategic will drafting to safeguard your estate. By leveraging available reliefs and crafting flexible, adaptive wills, we help clients minimise IHT liabilities and preserve their legacy for future generations. We're here to ensure your wishes are respected and your loved ones are cared for.

Our Team

Hanieh Shadmani is an accomplished Solicitor specialising in Wills & Probate, based in our head office located in the City of London. With an extensive background spanning 9 years in the legal arena, she brings a wealth of expertise to her role. Hanieh has adeptly managed a diverse array of probate matters, ranging from intricate and contentious cases to straightforward and non-contentious ones. She diligently oversees the day-to-day operations and progression of cases, ensuring the utmost attention to detail and efficacy in her practice. For advice or assistance on a wills & probate matter, contact Hanieh at haniehs@duncanlewis.com or via telephone at 020 31141330.

Hanieh is part of the team led by Wills and Probate director Caroline Roche. She has a proven track record in successfully handling a wide range of contentious probate claims, including those under the Inheritance (Provision for Family and Dependants) Act 1975, claims for equitable relief via proprietary estoppel, constructive trusts, resulting trusts, and TOLATA claims. Caroline’s expertise also covers will disputes, trust disputes, asset valuation issues, and dealing with difficult executors.

For advice or assistance with probate matters, you can contact Caroline Roche via email at CarolineR@duncanlewis.com or by telephone at 020 3114 1104.

Duncan Lewis Solicitors

Duncan Lewis Solicitors, an award-winning law firm, is renowned for its exceptional legal services and commitment to justice. The company employs a team of highly skilled solicitors offering top-tier representation in 25 fields of law, and ranked as top tier by the Chambers and the Legal 500 legal guides, and as one of the top 250 law firms in the country by the Times. Duncan Lewis was crowned Law Firm of the Year at the LexisNexis awards 2024, further establishing its credentials as one of the leading law firms in the UK.