Married and Civil Partners with estates unlikely to have Inheritance tax liability

The CTT Group recommended solution for married or civil partner clients with estates unlikely to have an inheritance tax liability is quite simple but effective utilising the many benefits of discretionary trusts. Clients are unlikely to have an Inheritance tax liability if their combined estates are valued at less than two Nil Rate Bands (currently £325,000 x 2). As the estates are less than the NRB amounts there is no necessity to utilise interest in possession trusts as spousal exemption from Inheritance tax is not required. However, it is always worth considering the possibility of future growth to their estates particularly when dealing with younger clients and so if it may be likely that their estates will exceed the Nil Rate Band allowances in the future then you should consider recommending the solution for married couples whose estates are likely to have an Inheritance tax liability instead. This will help future proof their planning. 

Depending on the asset types you may want to consider the use of further trusts, most notably Business or Agricultural trusts, Pension Death Benefit trusts and Life Assurance trusts.  

Please see the video below and the explanation sheets to understand the planning. The trust names differ if you are using pilot trusts or trusts within the will but they are equally effective to achieve the desired results.