{"id":1533,"date":"2016-03-03T09:32:12","date_gmt":"2016-03-03T09:32:12","guid":{"rendered":"http:\/\/www.bwmltd.org\/wordpress\/?p=1533"},"modified":"2016-03-03T09:32:12","modified_gmt":"2016-03-03T09:32:12","slug":"what-a-relief-2","status":"publish","type":"post","link":"https:\/\/www.vizionwealth.co.uk\/news\/what-a-relief-2\/","title":{"rendered":"What a relief"},"content":{"rendered":"

Assets that pass on free of Inheritance Tax<\/strong><\/p>\n

Inheritance Tax reliefs allow some assets to be passed on free of Inheritance Tax or with a reduced bill.<\/p>\n

The executor of a will or administrator of an estate should claim the reliefs when they\u2019re\u00a0working out how much the estate is worth.<\/p>\n

Business Relief<\/strong>
\nBusiness Relief\u00a0allows a business to be passed on as a going concern by reducing the Inheritance Tax on it by up to 100%.<\/p>\n

Agricultural Relief<\/strong>
\nAgricultural Relief\u00a0allows a working farm to be passed on as a going concern without paying Inheritance Tax on it.<\/p>\n

Woodland Relief<\/strong>
\nYou don\u2019t include the value of the timber in a woodland when you\u2019re\u00a0working out the value of an estate\u00a0but must include the value of the land.<\/p>\n

Whoever inherits the woodland may have to pay Inheritance Tax when they sell the timber \u2013 unless it qualifies for Agricultural or Business Relief.
\nIf the woodland also qualifies for Agricultural Relief or Business Relief (for example, if it\u2019s part of a working
\nfarm or business), it won\u2019t qualify for Woodland Relief.<\/p>\n

Heritage assets<\/strong>
\nSome buildings, land and works of art which have historic or scientific interest may be\u00a0exempt from Inheritance Tax.<\/p>\n

The assets must be made\u00a0available for the public to view\u00a0and meet other conditions to qualify as exempt.<\/p>\n

Heritage assets can also be\u00a0 transferred to the Crown to pay an Inheritance Tax bill.<\/p>\n

Passing on a home<\/strong>
\nHow much Inheritance Tax is charged on a home depends on how the person who died owned it and how they passed it on.<\/p>\n

Passing on a home as a gift<\/strong>
\nIf a person passed on their home to their children (or someone else) before they died, it\u2019s treated as a gift, and the seven-year rule\u00a0applies.<\/p>\n

But if they continued to live in it rent-free, their estate has to pay Inheritance Tax on the home even if they lived for seven years after giving it away. This is known as a \u2018gift with reservation of benefit\u2019.<\/p>\n

Giving away the home and moving out<\/strong>
\nThe original owner can make social visits and stay for short periods in a home they\u2019ve given away without affecting the\u00a0seven-year rule.<\/p>\n

Giving away part of the home to someone who
\nmoves in<\/strong>
\nIf a person gave away half their home to their children (or someone else), who moved in and shared the bills, the half given away won\u2019t be included in the valuation of the estate.<\/p>\n

Giving away the home and living in it<\/strong>
\nIf the original owner lives in the home after giving it away, they must pay the new owner a \u2018market rent\u2019 (the going rate for similar local rental properties).<\/p>\n

Selling a home and giving away the money<\/strong>
\nIf someone sold their home and gave the money to their children (or someone else), the money will be treated as a gift, and the\u00a0seven-year rule\u00a0will apply.<\/p>\n

If they bought a new home as a joint owner with one or more others, the home may count as a \u2018pre-owned asset\u2019, and there may be Income Tax to pay on it.<\/p>\n

Leaving a home in a will<\/strong>
\nWhen a home was wholly owned by the person who died, the value of the whole home is included in the estate for Inheritance Tax purposes.<\/p>\n

When a home was owned by more than one person, only the share owned by the person who died is included in the estate for Inheritance Tax purposes.<\/p>\n

Passing on a home to a husband, wife or registered
\ncivil partner<\/strong>
\nA widow, widower or bereaved registered civil partner automatically inherits the deceased\u2019s share of the house if they owned the home as \u2018joint tenants\u2019. There\u2019s no Inheritance Tax if they continue to live in it.<\/p>\n

If they owned the home as \u2018tenants in common\u2019, each can pass on their share of the home to anyone else in their will.<\/p>\n

Second homes<\/strong>
\nIf someone gives away a home that isn\u2019t their main home, they may have to pay Capital Gains Tax\u00a0if the value of it has increased since they first owned it.<\/p>\n

Leaving assets to a spouse or registered civil partner<\/strong>
\nAn estate is exempt from Inheritance Tax if the deceased left everything to their husband, wife or registered civil partner who lives permanently in the UK.<\/p>\n

Married couples and registered civil partners can give any value of\u00a0gifts\u00a0to each other during their lifetime without Inheritance Tax being due on them.
\nThis is known as \u2018spouse or registered civil partner exemption\u2019.<\/p>\n

Transferring Inheritance Tax thresholds<\/strong>
\nIf someone\u2019s estate is less than the Inheritance Tax threshold of \u00a3325,000, the remaining threshold can be transferred to their husband, wife or registered civil partner\u2019s estate when they die \u2013 even if they remarried.<\/p>\n

This means the surviving partner\u2019s estate can currently be worth up to \u00a3650,000 before any Inheritance Tax is due.<\/p>\n

The transfer is made when the surviving husband, wife or registered civil partner dies, and is done by the executor of their Will or administrator of their estate when they work out how much it\u2019s worth.<\/p>\n

Exceptions
\n<\/strong>The rules for transferring a threshold are different if the:<\/p>\n

\u2022 Estate of the first spouse or registered civil partner qualified for\u00a0relief on woodland or heritage assets
\n\u2022 Surviving spouse or registered civil partner had an unsecured pension as the \u2018relevant dependant\u2019 of a person who died with an Alternatively Secured Pension
\n\u2022 First spouse or registered civil partner died before 1975<\/p>\n

Keeping records<\/strong>
\nThe executor or administrator of the estate should give the surviving husband, wife or registered civil partner documents that show any unused Inheritance Tax threshold. These will be needed to transfer the threshold to the surviving partner\u2019s estate when they die.<\/p>\n","protected":false},"excerpt":{"rendered":"

Assets that pass on free of Inheritance Tax Inheritance Tax reliefs allow some assets to be passed on free of Inheritance Tax or with a reduced bill.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[],"_links":{"self":[{"href":"https:\/\/www.vizionwealth.co.uk\/news\/wp-json\/wp\/v2\/posts\/1533"}],"collection":[{"href":"https:\/\/www.vizionwealth.co.uk\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vizionwealth.co.uk\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vizionwealth.co.uk\/news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vizionwealth.co.uk\/news\/wp-json\/wp\/v2\/comments?post=1533"}],"version-history":[{"count":0,"href":"https:\/\/www.vizionwealth.co.uk\/news\/wp-json\/wp\/v2\/posts\/1533\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.vizionwealth.co.uk\/news\/wp-json\/wp\/v2\/media?parent=1533"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vizionwealth.co.uk\/news\/wp-json\/wp\/v2\/categories?post=1533"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vizionwealth.co.uk\/news\/wp-json\/wp\/v2\/tags?post=1533"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}