Patrick & Elisabeth's Inheritance Tax planning

Client stories

Patrick & Elisabeth's Inheritance Tax planning

Through effective use of Trusts, we helped saved £140,000 from their Inheritance Tax bill, plus ongoing savings of £16,000 per year.

Estate planning advice

Patrick and Elisabeth have an estate which is valued quite a bit above the Inheritance Tax thresholds, so their family was facing a significant tax liability on their deaths.


After working with a local Will Writer, who helped them update their Wills and register Lasting Powers of Attorney to their children, they were referred to us to see if there was any further estate planning which could be achieved.

They had worked with another financial adviser for some time, who had taken some good steps towards reducing their Inheritance Tax liability. 

However, we were able to build upon that previous work through the use of Trusts, to reduce their tax bill further. 

Inheritance tax

Significant savings from effective planning

Whilst they held a portfolio of investments which were exempt from Inheritance Tax, those assets still counted towards their estate value when determining their Nil Rate Bands – which is the amount you can have in your estate before you begin to pay Inheritance Tax. 

We were able to take steps to restructure their portfolio and reinstate their Residence Nil Rate Bands in full – this increased their combined Inheritance Tax Threshold from £650,000 to £1 million, in turn reducing their tax liability by £140,000.

Further to this, they also had generous surplus income – i.e. the amount of income they were receiving from pensions, was quite a bit higher than the amount they needed to meet their living expenses. 

This was simply adding to their problem, as they were consistently building more wealth within their estate.

Therefore, a second Trust was created into which they could gift this surplus income and receive immediate Inheritance Tax relief – this additional Trust saves them approximately £16,000 per year of further tax liabilities.

Tax advice and Trust planning are not regulated activities for financial advisers, and these activities are not regulated by the Financial Conduct Authority.
We recommend that any advice we provide in these areas is verified by an Accountant and Trust specialist, for whom these activities are either regulated and/or they hold indemnity insurance to protect clients.