11 Oct 2017
As a general rule, inheritance tax (IHT) is collected from a person’s estate when they die and can also be payable during a person’s lifetime on certain trusts and gifts. There is normally no tax to be paid if the value of the estate is below the IHT nil rate threshold of £325,000. There is also a new IHT main residence nil-rate band (RNRB) that was introduced in April 2017. The RNRB will ultimately allow for a £175,000 per person transferable allowance for married couples and civil partners when their qualifying main residence is passed down to children after their death. The RNRB is in addition to the £325,000 IHT threshold.
The remaining amount after deducting IHT exemptions, reliefs and the nil rate band is liable to IHT at 40%. A reduced rate of IHT of 36% applies where 10% or more of a deceased’s net estate is left to charity. In some circumstances, the inheritor may be liable to pay IHT if the deceased person's estate can’t or doesn’t pay. There can also be IHT payable by the inheritor, if an inheritance is put into a trust that doesn’t pay the IHT due. HMRC will contact inheritors that are required to pay IHT.
The inheritor is also liable to pay tax on any profit they make from inherited cash or assets. For example, where a property is inherited and then rented - income tax would be due on the rental income (subject to the usual rules). Likewise, if assets are inherited and subsequently sold, capital gains tax would be due on the increase in value since the person died.
There are legitimate ways to minimise any IHT due to the Exchequer. These can include giving away surplus income, making gifts before you die (known as Potentially Exempt Transfers) and giving gifts to charity. We would be happy to help you look at your estate planning options.
Vada Studios is a very successful music recording facility. The business had outgrown their existing premises, and had a vision to create one of the top residential recording studios in the UK.
A highly successful restaurant, butcher and retail business.
GJA have been the retained accountants for this property investment and development group for over 20 years. Imminently due to dissolve companies.
Proco approached us with an idea of becoming a distributor of a high-end product in the UK, supplying vinyl nationally.
In 2008 Tom Floate left his employer to set up his own business providing website services. Initially forming a partnership with his wife Rachel, they began trading IO Studios from their home office.
Barry the Butcher is a very successful wholesale butchery and retail business.
Grenfell has a broad range of experience and knowledge, working with clients from many different industry sectors. Grenfell is also the senior audit partner in the practice.
Chris works with a diverse profile of owner managed businesses to assist them to grow and retain wealth. Although Chris works with clients from a wide range of sectors, he has particular expertise in property, catering, consultancy and professional services.
Managing Director ACMA
Alex has worked for Grenfell James since 2002 and became a director in 2013. Overseeing our internal operations, he manages the flow of work and ensures we hit our strict deadlines. Alex also manages a portfolio of clients, with expertise in manufacturing and service businesses.
Operational Director MAAT
David has worked for Grenfell James since 2006. He heads up our tax team and is highly experienced with expertise in different industries and sectors.
Tax Director ACCA
Hannah qualified in 2016, having worked for the company since 2009. She acts as a client manager for a range of businesses, with expert knowledge of the equestrian and rural sector. Hannah also manages our payroll team.
Client Manager ACCA
Andrew Knight. The Howard Arms Ilmington
Roy Ferguson. The Perfect Cosmetics Company.
Regent Square Estates
NPD Design Consultants Ltd
Mr I Cameron
Mckechnies independent tea and coffee bar.
Dean. Wootton IT
Paul Stanley. A S Contracts Ltd.
Proco Coatings & Laminates
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