Inheritance tax can significantly reduce what you leave behind, but with the right planning, much of it can be minimised or avoided. Whatever your assets, getting specialist advice from a private client solicitor can help more of your wealth reach the chosen beneficiaries in your will.
Our inheritance tax planning solicitors in London work with you to structure your will and estate in the most tax-efficient way, so more of what you’ve built stays with the people you care about.
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We have a team of inheritance tax planning solicitors on hand to answer your questions about your will and inheritance tax. Our experienced team explain inheritance tax in jargon-free terms, helping you take the legal steps you need to ensure wealth is passed on to your loved ones.
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What Is Inheritance Tax and Who Pays It?
Inheritance tax (IHT) is charged on the value of someone’s estate when they die, above certain tax-free thresholds. It’s sometimes called a “voluntary” tax, because careful planning during your lifetime and the way you draft your will can significantly reduce, or even remove, the liability altogether.
Every individual has a nil-rate band of £325,000 that can pass free of inheritance tax. This can, however, be eroded, so you cannot assume the full band will be available on death. Our knowledgeable team of inheritance tax planning solicitors can advise on this.
Anything above the available threshold is normally taxed at 40%. However, several reliefs and allowances can increase how much of your estate escapes tax, which is where planning makes a real difference.
How Inheritance Tax Planning Works
Effective inheritance tax planning usually involves a combination of strategies, tailored to your personal and financial circumstances. Our lawyers can find a solution tailored to your needs.
Making Use of the Nil-Rate Band
Married couples and civil partners can usually transfer any unused nil-rate band to the surviving spouse, potentially giving a combined allowance of up to £650,000 before tax is due.
The Residence Nil-Rate Band
If you leave your home to children, grandchildren or other direct descendants, an additional residence nil-rate band may apply on top of the standard threshold, further increasing the amount that can pass tax-free. This is subject to an estate value threshold where the band can be eroded and reduced to nil.
Lifetime Gifts and the Seven-Year Rule
Gifts made more than seven years before death are generally exempt from inheritance tax. Smaller annual gifts can also be made without triggering a liability. Getting the timing and structure of gifts right is a key part of effective planning.
Trusts and Other Tax-Efficient Structures
Placing assets into a trust can be an effective way to manage how and when your beneficiaries receive their inheritance, while potentially reducing the value of your taxable estate.
Trusts aren’t right for everyone, so we’ll advise honestly on whether one suits your circumstances. If you’d like to explore this further, our trust solicitors can advise on setting one up.
Why Your Will Matters for Inheritance Tax
Inheritance tax planning and will writing go hand in hand. Without a valid will in place, your estate is distributed according to the strict rules of intestacy, which may not reflect your wishes and often won’t be the most tax-efficient outcome for family members who inherit your money.
A well-drafted will allows you to:
- Direct your estate to make full use of available allowances and reliefs
- Provide for a spouse, civil partner or family member in a tax-efficient way
- Set up trusts where appropriate to protect assets for future generations
If you don’t yet have a will in place, our will writing solicitors can help you put one in place alongside your tax planning. If your circumstances have changed since you last wrote your will, it may also be worth reviewing or updating it, since your tax position can shift over time.
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How Our Inheritance Tax Planning Solicitors Can Help
Our specialist solicitors in London take the time to understand your individual circumstances before recommending a course of action. We can help you:
- Understand your current potential inheritance tax liability
- Explore the full range of reliefs, allowances and gifting strategies available to you
- Structure your will to make the most of tax-efficient options
- Set up trusts where they genuinely benefit your family
- Review your existing will and tax planning as your circumstances or the rules change
If you’re already dealing with the estate of someone who has died, our probate solicitors can guide you through the application process, and our team can advise on distributing the estate once the grant has been obtained.
Why Choose TV Edwards?
- Recognised expertise – TV Edwards is recognised by Legal 500 and Chambers UK for private client work
- Specialist advice – our solicitors take time to understand your personal circumstances rather than offering generic guidance
- Clear explanations – we explain inheritance tax in plain English, without unnecessary jargon
- Ongoing support – we recommend regular reviews, since tax rules and personal circumstances both change over time
- Established London firm – with offices across London and a strong reputation for private client work
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Inheritance Tax Planning FAQs
Will my estate be charged inheritance tax?
Whether your estate pays inheritance tax depends on its total value and which allowances and reliefs apply. Every individual has a nil-rate band of £325,000, with a further residence nil-rate band available in some circumstances, so many estates pay little or no tax with the right planning.
How can I reduce inheritance tax legally?
Common strategies to reduce inheritance tax legally include making use of the nil-rate band and residence nil-rate band, making lifetime gifts outside the seven-year rule, and setting up trusts where appropriate. The right combination depends on your individual circumstances.
Do I need a solicitor for inheritance tax planning?
You aren’t legally required to use a solicitor for inheritance tax planning, but inheritance tax rules are detailed and interact closely with how your will is drafted, so professional advice from a lawyer can help you avoid costly mistakes and make the most of available reliefs.
How often should I review my inheritance tax plan?
We recommend reviewing your will and tax planning every five to seven years, and sooner after major life events such as marriage, divorce, having children or a significant change in your assets.
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