Taxation

Inheritance Tax Planning
 
On your death your estate might be liable to pay Inheritance Tax. This tax is payable if the value of your estate is over a certain limit, which changes from time to time. If you own your house your assets could easily exceed the amount above which Inheritance Tax is due (although any amounts owed, such as a mortgage, are excluded from the calculation). You may want to save your family from having to find money for Inheritance Tax.
 
Life insurance can be arranged in such a way that on your death the sum insured does not form part of your estate and will not then be liable to tax.  The policy proceeds can then be used to pay any tax for which the estate is liable or to meet day to-day expenses while your dependants wait for money from your estate to become available.  Gifts given in the last seven years of your life can also create a liability to pay Inheritance Tax. Life insurance can be arranged to cover this liability.

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Income Tax
 
Provided your policy is a “qualifying policy” the benefits paid on death or maturity are not subject to income tax. To qualify, a policy has to satisfy certain statutory conditions. These include the need to pay premiums at annual or shorter intervals for at least 10 years or until your earlier death. Your sales person, adviser or insurer will tell you whether or not your policy is a qualifying one.  

The information set out on this page is intended to provide a general appreciation of the topic and it is not advice. Guidance should be sought from a specialist who is qualified to advise in your specific circumstances.

For more information on any aspect of Inheritance Tax please contact Surrey Financial Advice on 01483 211800 or email us at admin@surreyifa.co.uk  We will be happy to assist you.