A recent survey has revealed the potential risks for gift givers seeking to issue inheritance to loved ones prior to their death.
A well-known strategy to offset inheritance tax (IHT) is through the efficient use of specific exemptions and reliefs available. Among these methods is the option to give gifts.
Traditionally, the passing on of gifts and assets has been performed when someone dies, with asset left to loved ones via a will. Due to the economic impact of the recent pandemic, more individuals are opting to give gifts before they die, but experts are warning that they could potentially be stepping into an expensive mishap regarding their estate planning.
The report’s figures found that more than 38 per cent of parents had already given substantial financial gifts to their younger family members. Out of those surveyed, the most popular reason to gift was to financially aid their grandchildren or children in the present, helping them to cover the cost of living.
However, the survey also saw around 10 per cent of respondents confirming that their gift giving would likely impact their own retirement. This highlights the importance for those who wish to give such gifts of considering the consequences carefully before they do so.
From inheritance tax issues to estate planning, those seeking to distribute their wealth before or after retirement will find wealth managers an expert source of advice. Savers looking for help with retirement planning in Chester, Birmingham and other major cities can obtain strategies that reduce IHT from wealth management firms, while also ensuring they have access to adequate funds after they stop working.
