All That You Should Know About Inheritance Tax
Inheritance taxes are taxes that are levied on the estate of someone who has passed away. And this includes all the property and related possessions, as well as the cash the deceased acquired while they were alive. If you look to managing the inheritance tax of your deceased relative, and you have never done this before, you should see to it that you are informed so that you make sound decisions.
Fundamentally, you need to two major things to value your estate for inheritance tax. It is the government of the day that sets the level – and this has to do with who is in power, and their attitude towards inherited wealth. Today, the inheritance tax threshold is 325,000 per person and this was effected in April 2016.
First, you need to list out all the assets, and make sure you determine their exact value at the date of death. It fundamental that you remember to deduct all the liabilities and debts. Place a lot of emphasis on how you arrived at your mathematical conclusions, in fact, it should provide an impression of a realtor’s valuation.
You see, you may be surprised to receive a request to explain how you worked out your inheritance tax even 20 years after you had paid and forgotten it. Be sure to include money stashed in banks, land, jewelry, cars, shares, property, insurance pay-outs, jointly owned assets in your valuation. Gifts in form of assets and cash should be included, especially if they were given seven years before the departure of the person in question.
There is every reason to tax anything that benefitted the person. Liabilities and debts reduce the value of the deceased’s chargeable estate. They may include credit card debts, some funeral expenses, household bills, mortgages and even gambling debts.
And then there is the issue of who should shoulder these inheritance taxes. In many cases, there are wills that were left behind. If there is any will, it is the administrator of the estate who does this.
You may be wondering if you have a chance to reduce or minimize the inheritance tax. And yes, you can do this. Notwithstanding the fact that you may have to seek legal assistance when doing this, and make sure you are dealing with someone who has the best skills and competence that you need. And you have all the legal rights to make use of the gifts that are available. Remember that this aspect works of you had received these gifts 7 years before your departure. It is after the elapse of these seven years when every exacting criteria will applied. If you do not have an idea of where to begin this, you should be sure to seek assistance from a probate attorney.