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April IHT increases will still leave homeowners exposed to 40% death
tax
EXPERTS are
warning that thousands of homeowners across the UK will still be
liable for Inheritance Tax (IHT), despite this month's increase in
the minimum amount subject to the so called 'death tax'.
Following last month's Budget, the IHT nil band rate (the maximum
amount you can leave before your estate becomes liable to tax)
increased from £285,000 to £300,000 for the new tax year starting
6th April 2007, and will rise to £350,000 by 2010. While the
Chancellor's increase in allowances are supposed to leave fewer
people exposed to IHT, the country's booming property market will
continue to push people's estates into the chargeable zone at the
rate of 40% taxation.
Howard Burns, a partner at national law firm Lewis Hymanson Small,
explains:- "People should not be blinded by the nil band rate
increase. House prices are increasing by an average 8% to 10% per
year, whereas the IHT threshold will increase by around 4% per year
over the next three years. Put simply, IHT allowances are not
balanced with the rising value of people's estates or sufficient
enough to protect the vast majority of homeowners."
The IHT nil rate band will rise to £312,000 in April 2008 and
£325,000 in April 2009 before reaching £350,000 in 2010. Burns
adds:- "Although £300,000 plus sounds like a lot of money,
many people do not realise how easy it is to creep past the
threshold.
In addition to rising property values, inheritance and life
insurance payouts received upon the death of a spouse, civil partner
or parent and forgotten savings can all push estates significantly
into the 40% tax bracket."
The traditional approach to beating IHT is to give away assets more
than seven years prior to death. However, giving away the family
home while still living in it has become more difficult in recent
years. Burns explains:- "If an individual gifts a home but
still lives in it, they will fall under the gifts with reservation
of benefit rule, meaning the asset would still be subject to IHT. In
addition, income tax can be levied on the notional rental value of a
home."
To cost effectively mitigate IHT, Burns advises that people reassess
their wills and the distribution of estate: He concludes:- "A
Deed of Variation can allow a deceased person's Will to be
re-written so that the deceased's estate is redirected, as long as
it's written within two years of death and agreed by all
beneficiaries."
But what is Inheritance Tax? Inheritance Tax is the tax that is paid
on your estate. Broadly speaking this is everything you own at the
time of your death, less what you owe. It's also sometimes payable
on assets you may have given away during your lifetime. Assets
include things like property, possessions, money and investments.
Inheritance Tax exemptions:- There are also a number of exemptions
which allow you to pass on amounts (during your lifetime or in your
will) without any IHT being due, for example:- If your estate passes
to your husband, wife or civil partner and you are both domiciled in
the UK there is no IHT to pay even if it is above the nil band rate.
Most gifts made more than seven years before your death are exempt.
Certain other gifts, such as wedding gifts and gifts in anticipation
of a civil partnership up to £5,000 (depending on the relationship
between the giver and the recipient), gifts to charity, and £3,000
given away each year are also exempt. |
This June why not Play Up!
JOIN us from
Friday 8 June 2007 to Wednesday 13 June 2007 as we celebrate the
very best of children’s theatre with Play Up! - Theatre for Young
Imaginations, Southport Arts Centre’s first children’s theatre
festival. The week long festival is jam packed with exciting
productions that will enchant and entertain children from under 3
years to 9 years and upwards.
The week has something for everyone including, Jason & The
Argonauts, Hood in The Wood and Comedy for Kids with James Campbell,
the world’s first stand up comedian for children. And, don’t worry
we haven’t forgotten our younger audiences of 3 and under with the
interactive Egg & Spoon, featuring Cbeebies favourite Patrick Lynch
from Razzle Dazzle!
Play Up! is about making children’s theatre accessible to children
everywhere and what better way but to give schools FREE
performance/workshop packages of Hood in the Wood, available within
schools from Monday 11 June to 13 June 07. (Information will be sent
to schools but please call Emma Burrows on 0151 934 2129 for more
details).
Halfway to Paradise; The Billy Fury Story comes to St. Helens
IN 1983,
Britain lost one of its most treasured, iconic, rock and roll stars,
while his band lost their valued friend and lead singer. After
mourning their loss, the band began to dream of carrying on the
legend, recapturing the memories of yesteryear and providing fans
with a nostalgic taste of their lost idol.
It was not until 1996 that a young man, bearing a spine-tingling
familiarity, appeared on television screens across the country and
announced, “Tonight Matthew, I’m going to be Billy Fury”.
Colin Gold went on to stun Fury’s Tornados with a performance that
perfectly recreated the sound and sight of the original rocker. From
that moment on, the band’s dream suddenly had a chance of being
fulfilled and soon afterwards, The Billy Fury Story was born.
Now celebrating their 10th anniversary together, Colin and the
original band continue to tour, performing the greatest Fury hits of
the 60s and 70s, delighting audiences at many of the UK’s largest
venues and concert halls and will be heading to the Theatre Royal,
St. Helens, on Saturday, 5 May 2007.
Timeless hits such as I Will, Jealousy, It’s Only Make Believe and,
of course, Halfway to Paradise will be performed on stage in a
two-hour spectacular show that includes a narration of Billy’s life,
from his humble beginnings working the River Mersey tug-boats
through to his music success, and exclusive screen footage of the
man himself in action with Fury’s Tornados.
Lead guitarist, and unofficial organiser of the band, Chris Raynor
comments:- “Every member of the band is always surprised and
delighted by the warm reception we receive wherever we perform, and
this forthcoming show already appears to be no exception. We’re very
excited to be performing here”
To book tickets for Halfway to Paradise – The Billy Fury Story at
the Theatre Royal, contact the Box Office on 01744 756000. |
