Protecting your Property Portfolio against Inheritance Tax

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If your residential property portfolio is owned personally by you and you intend your dependents to inherit, you need to consider the impact of inheritance Tax (IHT).

For example, if you own ten buy-to-let terraced houses at £100,000 each, then you have a combined value of £1M.

IHT requires 40% tax to be paid above the £325,000 nil rate band.

Your dependents would therefore have an IHT bill of £270,000, meaning in all likelihood, they would need to sell three properties to fund this. Of course, this also depends on the property market at the time, which could be at the bottom of the cycle, say post-Brexit. In which case it could be four which would need to be sold to finance this.

Another option is to take out a Whole of Life Policy for £270,000 which would cover the IHT bill and allow your dependents to inherit all ten properties, thus keeping your portfolio intact for the next generation.

The Reich Group includes Reich Life, who have access to all the major Insurers in this area. We can arrange your Life Assurance as well as insure your property assets all under one roof.

Contact us if you wish to explore this further and obtain a no obligation quotation.

Tags: Inheritance | InheritanceTax | Tax | LifeAssurance | LifeInsurance | ResidentialProperty | IHT