Do you have an inheritance liability upon death?

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Add up all your worthly possessions, (home, investments, cash, chattels, car) and minus any liabilities (mortgage, annual exempted and 7-year gifts) will equal your estate value.

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The current threshold is £325,000 per person, therefore a married couple would have a threshold of £650,000. If the value of your estate exceeds that threshold then you will be liabile for IHT. Any value over the threshold will be taxed at 40%.

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On top of the IHT threshold, there is now also a residential nil rate band, which as long as you give your main home to children, stepchildren or grandchildren,  including when adopted or fostered is an additional threshold of the following amounts:

• £100,000 in 2017 to 2018

• £125,000 in 2018 to 2019

• £150,000 in 2019 to 2020

• £175,000 in 2020 to 2021

A married couple could benefit from 1 million of a threshold if they gift their home to their child or grandchild.