Financial planning ‘may benefit the wealthy’

The wealthy may benefit from planning for inheritance tax (IHT), it has been stated.

Since the nil-rate band for IHT for civil partners and married couples was raised to £600,000, fewer people may find that they have to make substantial provisions for dealing with IHT for the time being, said Nick Hughes of accountancy practice BDO Stoy Hayward.

However, he told the Guardian that wealthier individuals may find that they can benefit from seeking legal advice and setting up trusts.

Couples with assets that are increasing in value at a rate faster than inflation may find they are more financially secure if they set up trusts.

The publication also notes that married couples can create lifetime versions of nil-rate band trusts, putting in assets equal in value to the current IHT allowance – £300,000 every seven years – but states that good professional advice is needed.

In his pre-Budget report, chancellor of the exchequer Alistair Darling announced that the threshold for IHT will increase to £700,000 by 2010.