death duties....how to legally avoid
Discussion
Was watching a prog where some chap had to flog a mountain to help pay off 9mill !!!!!!! death duties.
This got me thinking. I win say 100m+ on lottery, what ways can I stop HMG getting their hands on a wedge of it,and all going to my son and grandkids.
I could start up a ltd co with the bulk as capital and let them take a wage,ok inc tax would be paid,but surely it's going to be less than dd?
Offshore trusts?
Buying bits and 'hiding' them?
Putting it in a sock and claiming I lost it all with on track bookies?
Any other ways we could beat the system?
This got me thinking. I win say 100m+ on lottery, what ways can I stop HMG getting their hands on a wedge of it,and all going to my son and grandkids.
I could start up a ltd co with the bulk as capital and let them take a wage,ok inc tax would be paid,but surely it's going to be less than dd?
Offshore trusts?
Buying bits and 'hiding' them?
Putting it in a sock and claiming I lost it all with on track bookies?
Any other ways we could beat the system?
Give it to them and live for 7 years on what you have left.
Or 7 years and a day before your going to die, give them everything except 7 years worth and a penny that you will live off, actually you can be conservative and overshoot how much you meed by the IHT allowance that will be in force on the day you have arranged to die.
Or 7 years and a day before your going to die, give them everything except 7 years worth and a penny that you will live off, actually you can be conservative and overshoot how much you meed by the IHT allowance that will be in force on the day you have arranged to die.
Edited by ViperDave on Friday 9th May 09:22
Put the money in trust. This trust will be established for the benefit of yourself and children, with a number of trusted people including yourself as trustees. Documentation can be amended at a later date to add childrens children etc.
Money can then be held and distributed tax-free from the trust when needed
Also if structured properly the trust never dies = no death taxes
Money can then be held and distributed tax-free from the trust when needed
Also if structured properly the trust never dies = no death taxeskiethton said:
Put the money in trust. This trust will be established for the benefit of yourself and children, with a number of trusted people including yourself as trustees. Documentation can be amended at a later date to add childrens children etc.
Money can then be held and distributed tax-free from the trust when needed
Also if structured properly the trust never dies = no death taxes
This and only this.Money can then be held and distributed tax-free from the trust when needed
Also if structured properly the trust never dies = no death taxesChris
kiethton said:
Put the money in trust. This trust will be established for the benefit of yourself and children, with a number of trusted people including yourself as trustees. Documentation can be amended at a later date to add childrens children etc.
Money can then be held and distributed tax-free from the trust when needed
Also if structured properly the trust never dies = no death taxes
Hmmm, it's rather more complicated than that though. That makes is sound like you can lob money into a trust and it's then free of tax. In reality there is a lot more too it than that, setting up a trust that you control and benefit from and don't pay tax on is something of a challenge when HMRC hear about it.Money can then be held and distributed tax-free from the trust when needed
Also if structured properly the trust never dies = no death taxeskiethton said:
Put the money in trust. This trust will be established for the benefit of yourself and children, with a number of trusted people including yourself as trustees. Documentation can be amended at a later date to add childrens children etc.
Money can then be held and distributed tax-free from the trust when needed
Also if structured properly the trust never dies = no death taxes
This is the correct answer. Very common practice for people with significant enough assets and a significant enough IQ (and desrie to avoid inheritance tax).Money can then be held and distributed tax-free from the trust when needed
Also if structured properly the trust never dies = no death taxesTo the OP, yes, this is using a trust.
You may have notice Bernie has done this ..... worth a read
http://www.bbc.co.uk/news/uk-27144637
You may have notice Bernie has done this ..... worth a read
http://www.bbc.co.uk/news/uk-27144637
Pay your taxes.
Actually what I mean is pay your taxes on the money you've already been taxed on and then pay some more tax.
Obviously this doesn't apply to people who've won money who should spend it all within a few years on drugs/hookers/hangers on etc etc and then embark on a tax reclamation scheme of their own ie a benefits claim.
If it was me and I won a large sum of money I wouldn't be living in a tax repressive regime like the UK in any case. I believe the sceptic isle is a great place to visit for a limited number of days every year.
Actually what I mean is pay your taxes on the money you've already been taxed on and then pay some more tax.
Obviously this doesn't apply to people who've won money who should spend it all within a few years on drugs/hookers/hangers on etc etc and then embark on a tax reclamation scheme of their own ie a benefits claim.
If it was me and I won a large sum of money I wouldn't be living in a tax repressive regime like the UK in any case. I believe the sceptic isle is a great place to visit for a limited number of days every year.
kiethton said:
Put the money in trust. This trust will be established for the benefit of yourself and children, with a number of trusted people including yourself as trustees. Documentation can be amended at a later date to add childrens children etc.
Money can then be held and distributed tax-free from the trust when needed
Also if structured properly the trust never dies = no death taxes
A lot of errors in this. Trusts are not tax exempt, they pay income tax in the UK at the highest nominal rate, currently 45% for example. Placing more than the nil rate, £325,000, into a discretionary trust leaves you liable to upfront IHT at 20% and ongoing tax charges as well.Money can then be held and distributed tax-free from the trust when needed
Also if structured properly the trust never dies = no death taxesIf the settlor is a beneficiary you typically have no benefit at all from the IHT angle.
Trusts can help as part of a plan, but its a lot more complex than you imply.
Other angles to consider would be purchasing of Agricultural land, or shares with Business Property Relief, direct gifting to beneficiaries, either from income or from capital within limits, the survive 7 years from a major gift option, insure against the liability, max out pensions as far as possible etc etc
Edited by ellroy on Friday 9th May 17:19
POORCARDEALER said:
I have sold expensive cars to people with many millions who have trusts, usually had to write to the trusts and request the money as it doesnt belong to the person buying the car.....
How odd. Even with millions in trust and taking into account the miserly nil rate bands, one can easily maintain a readily accessible pot of up to £650K. Should be enough to buy the odd motor. Jasandjules said:
I may be being a muppet here, but to pay 9m in taxes surely he had to inherit rather a lot more than that?
I think the problem is that the tax man insists on being paid in cash, grubby little oik that he is. If your ancestors are thoughtless enough to leave you vast amounts of wealth in some other form, you have a situation to resolve.Forums | Speed, Plod & the Law | Top of Page | What's New | My Stuff


