Effective ways of reducing Inheritance tax

THE FOLLOWING are some ideas which can assist in this tax planning exercise:

Transfer or hold property in joint names as property in joint tenancies can be passed, on the death of one of the parties, to the other party/ies named on title tax free;

Make a will based on your wishes, but also based on the tax-free thresholds available to your beneficiaries in the will;

Be generous to your other half in your will as assets of any kind can be passed tax-free to your surviving husband, wife or civil partner;

Know the criteria for the various CAT reliefs available and utilise them where applicable e.g. Agricultural, Business, Favourite Nephew/Niece, Dwelling-House Relief;

Take out a Life Assurance Policy, known as a section 72 Policy, to cover the CAT payable by your beneficiaries;

Consider setting up a Trust, particularly where the beneficiaries are minors;

Cashable assets are very important as this helps beneficiaries pay off the CAT liability without needing to get loans etc.;

Every year you can give a gift of €3,000 tax-free, blood relation or not. This will decrease the CAT payable.

Copyright © McKeever Rowan Solicitors, 10 July 2017.

This article is a general review and is not intended to be a complete statement of the law. Specific legal advice must be sought in every case. For further information on Wills, Probate and Estate Planning, please contact Gillian Cusack.