Tory plans ‘would not mean the end of gifts’

Conservative party plans to abolish inheritance tax (IHT) in favour of capital gains tax (CGT) would not mean the end of gifting or creating trusts, one industry body has stated.

Those looking to organise their estate may be interested to read news from the life assurance firm, which states that while inheritance tax has been in place an industry has sprung up around the creation of vehicles which mitigate its impact upon a deceased person’s wealth.

Julie Hutchison, estate planning specialist at Standard Life, asserts: "Considering the impact of [the proposals] on lifetime estate planning, it certainly would not necessarily mean the end of trusts or lifetime gifting.

"Indeed, it would become imperative to consider lifetime gifting earlier since the current seven-year clock for IHT could effectively become a ten-year clock."

Ms Hutchison concluded by saying that any simplification of the current IHT model was to be welcomed, with an integrated approach to taxation lifting some of the burden that affects an increasing number of households.

Recently, independent financial adviser Calculis announced that IHT was beginning to impact even on "modest homes", the occupiers of which were unaware of the levy likely to be required in the event of a death.