Inheritance Tax as a Tax Planning 3.
November 12th, 2009
Inheritance Tax as a Tax Planning .
In session number three we will talk about the ways how to minimise Inheritance Tax.
Outright gifts to another individual made during a person’s lifetime are known as a potentially exempt transfers’ or PETs. They are taxable if the person dies within 7 years, but have the potential to become exempt from the tax once the donor survives 7 years. There in no reduction in inheritance tax if the donor dies within 3 years.
In case that donor will survive first three years, and will die in one of the subsequent years, the tax reduction will be by one fifth on each of the followings years.
After first three years the tax will be reduced by one fifth to 32% and then by a further fifth on each of the subsequent anniversary until the assets are fully exempt from the inheritance tax after 7 years.
Continued in part 4.
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