Passing on your pension
If you have a pension pot that you would ultimately like to pass on to those you love, you’ll be pleased to hear that it is now possible to pass your pension pot on to your children and grandchildren at either no tax or at the beneficiaries income tax rate.
As of April 2015, the 55 per cent tax rate that was applied to pension pots left by savers to their children has been scrapped; instead, beneficiaries will either pay tax at their own income tax level – with the money they receive added to their earnings to calculate this – or if the person who dies is under 75 there will be no tax to pay. The new regulations mean that you can save money in a pension, benefit from tax relief at the higher rate of income tax, see any gains grow tax free, use the money as needed, and anything you don’t spend could be inherited by your family tax free.
Do you own a property within the European Union?
There is good news coming through from Brussels in relation to UK citizens owning property in the EU. With effect from 17 August 2015 it will be possible to avoid the normal “Forced heir-ship” rules which force you to leave a proportion of any property to your children on your death thereby potentially causing a UK Inheritance Tax bill to arise.
From 17 August 2015 if you own the property personally and your will is correctly drafted you will now be able to leave the property to whomever you wish as well as your spouse, and avoid UK Inheritance Tax. Additionally there will no longer be any need to use any form of structure to try to side step the “Forced heir-ship” rules.
If you are interested in finding out more about how any of these new regulations may affect you, please contact Tim Cook on firstname.lastname@example.org.