From TV relocation shows to make-over magazines there is a plentiful supply of material to feed that obsession and we all have seen how soaring property values affect the overall economy (and the mood of homeowners)!
However, there is one aspect of the recovering property market which will remove the smiles from many people’s faces – rising property prices will mean that more people will have to pay Inheritance Tax!
The tax is levied at 40% and becomes payable above the £325,000 threshold (frozen for the next three years). Treasury experts forecast that the proportion of those hit by this tax will increase from the 5% of the population currently affected to 10% by 2015 - yes that’s next year. Increasingly those on middle incomes, as opposed to just the ‘super rich’ are paying this tax.
So, far from being an issue of interest to a minority – the mitigation of Inheritance Tax is becoming relevant to a growing number of people. I’ve been championing the importance of Wills and Estate Planning legal services for homeowners for some time now, after all for most homeowners their property is their most significant asset and protecting that for the benefit of their family and any dependents should be high on a ‘to do’ list. But, if the thought of leaving family members with the stress of intestacy isn’t enough of a reason to take action then leaving them out of pocket certainly should be!
Recent statistics quote that 236,000 families will be in line for an Inheritance Tax bill in the next five years with those living in the south east most likely to have to pay up. Yet, those who consult a lawyer with a specialism in Wills and Estate Planning can take steps to mitigate their tax liability including taking advantage of tax free gifts and using trusts including Property Protection Trusts, Discretionary Trusts and Life Policy Trusts.
Recent Will Aid research in 2013 showed that 56% of the UK’s adult population do not have a will. Chances are that many of your clients are amongst them and, as asking about a will is part of the advice fact-find nowadays then I’m sure you’ll have come across plenty of examples of this.
With a growing number of your clients now falling into the Inheritance Tax band it’s becoming more relevant than ever to ensure you advise them holistically, signposting them to specialist lawyers who can help with Inheritance Tax mitigation and will writing.
This client centred approach will not only ensure your clients come back to you when they next need mortgage advice but also encourage them to share their positive experience with their family and friends – there’s no substitute for such ‘word of mouth’ marketing in growing your business.
