Although Inheritance Tax may be avoided if you leave your business assets or shareholding, agricultural assets or AIM-listed share portfolio to a spouse or Civil Partner, if these are sold during his or her lifetime or if this tax relief is abolished between 1st and 2nd deaths, the proceeds become taxable. Your children or other beneficiaries may be obliged to hand over 40% of their inheritance to the government.
By gifting your business/agricultural assets in your Will into a Family Trust the surviving spouse and children can make use of the assets during their lifetime and are not subject to Inheritance Tax on the survivor’s eventual death. The trust can be used in conjunction with a Cross Option Agreement and other tax or estate planning trusts in your Will.
