Dis­cov­er the Elite's Top Tips and Save on In­her­it­ance Tax

Press Release


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If you want to keep more of your wealth in the family instead of losing it to inheritance taxes, ultimately the winning approach is simple: Give gifts now and have an effective Last Will in place.

In­her­it­ance tax (IHT) can be a sig­ni­fic­ant con­cern for many fam­ilies across the UK. To help people nav­ig­ate this com­plex area, Aatos, a lead­ing legal tech firm in the Nor­dics, is pleased to unveil a de­tailed guide on re­du­cing in­her­it­ance tax li­ab­il­it­ies.

In­her­it­ance tax (IHT) in the UK is a tax on the estate (prop­erty, money, and pos­ses­sions) of someone who has died. The standard IHT rate is 40%, which is charged on the part of the estate that ex­ceeds the £325,000 threshold.

However, there are vari­ous re­liefs and ex­emp­tions avail­able, such as gifts, char­it­able dona­tions, trusts and Last Wills, that can help reduce the IHT li­ab­il­ity.

Many wealthy people use these strategies all the time. By plan­ning their estate in ad­vance, the av­er­age person can also achieve sig­ni­fic­ant sav­ings,” says Catrin Le Rendu, a so­li­citor at Aatos.

Money-Saving Tips

Annual Ex­emp­tion for GiftsGive away up to £3,000 worth of gifts each tax year.
Gifts for wed­dings or civil part­ner­shipsPar­ents can give up to £5,000, grand­par­ents and great-grand­par­ents £2,500, and anyone else up to £1,000.
Po­ten­tially Exempt Trans­fers (PETs)Gifts given more than seven years before death typ­ic­ally escape IHT.
Life In­sur­anceYou can ensure that life in­sur­ance pay­outs are kept out­side your estate to avoid in­creas­ing IHT, by put­ting your life in­sur­ance in trust.
Char­ity Dona­tionsDona­tions to re­gistered char­it­ies are IHT-exempt and can lower the tax­able value of your estate. By leav­ing at least 10% of your estate to char­ity, you can reduce the IHT rate on the re­main­ing estate from 40% to 36%.
Cre­at­ing a tax-ef­fi­cient WillAs of the 2024/25 tax year, the nil-rate band is set at £325,000. For mar­ried couples or civil part­ners, their com­bined nil-rate band can be doubled to £650,000 (as­sum­ing the estate is left to the sur­viv­ing spouse/part­ner). For the 2024/25 tax year, the Res­id­ence Nil-Rate Band allows an ad­di­tion­al £175,000 to be passed on tax-free when a main res­id­ence is left to direct des­cend­ants (chil­dren, grand­chil­dren, etc.).

“If the estate is plan­ned well ahead, it means that people can po­ten­tially pass on up to £500,000 tax-free if they meet the cri­ter­ia for the Res­id­ence Nil-Rate Band. For mar­ried couples or civil part­ners, this can in­crease to £1 mil­lion,” Le Rendu ex­plains.

If you want to keep more of your wealth in the family in­stead of losing it to in­her­it­ance taxes, ul­ti­mately the win­ning ap­proach is simple: Give gifts now and have an ef­fect­ive Last Will in place.

"Giving away money while you're still alive shrinks the value of your estate. But the real magic hap­pens when you com­bine that with a Will that max­im­ises tax al­low­ances and uses trusts to your ad­vantage", Le Rendu says.

Think of it this way – gift­ing allows you to share your good for­tune today and chip away at that future in­her­it­ance tax bill. But unless you've got a strategic Will in your corner, you're still leav­ing a lot on the table for the taxman.


Catrin Le Rendu
UK So­li­citor

Mariia Kukkakorpi
Com­mu­nic­a­tions Man­ager

Aatos is a lead­ing di­git­al legal ser­vice in the Nor­dics provid­ing com­pre­hens­ive, af­ford­able legal solu­tions across Fin­land, Sweden, Den­mark, and the United King­dom. Aatos spe­cial­ises in per­son­al legal doc­u­ments and advice, making legal ser­vices ac­cess­ible and un­der­stand­able for every­one. Aatos’s ser­vices in­clude e.g. draft­ing Last Wills, Pren­ups and Lasting Power of At­tor­neys.

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