£530 million set to be wasted in inheritance tax

21 Jul 2014

• Placing life insurance policies ‘under trust’ could save Britons £530 million in unnecessary inheritance tax payments
• unbiased.co.uk and Prudential launch inheritance tax checklist designed to help consumers take action with their inheritance planning
• unbiased.co.uk research shows only 27% of consumers would be confident in tackling inheritance tax planning without the help of a financial adviser

Research from unbiased.co.uk, the ‘find an adviser’ search, shows as much as £530 million1 is set to be wasted in inheritance tax (IHT) this year by individuals not placing life protection policies ‘under trust’ - £58 million more than last year.

Not putting the policy ‘under trust’ could reduce a £100,000 life insurance pay out by as much as £40,000 if an individual’s estate is worth more than £325,000, leaving a loved one at risk of a sizeable tax bill2.

With rising house prices and an improved economy set to leave more and more taxpayers exceeding the £325,000 inheritance tax-free threshold set by the government, unbiased.co.uk and Prudential have today launched an easy-to-follow checklist of what to consider when IHT planning, including understanding the value of your estate, gifting to loved ones and getting advice.

Research from unbiased.co.uk3 reveals only 27% of consumers would be confident in tackling inheritance tax planning without the help of a professional financial adviser.

Les Cameron, Head of Technical at Prudential, comments:

“It is often said that inheritance tax is a voluntary tax due to the number of different ways it can be avoided. However, Government statistics show that the amount of tax paid and number of families affected has been increasing over the last few years. There are several possible approaches and a wide range of solutions available to help people maximise the amount of wealth they pass on to their loved ones. IHT planning can range from the relatively straightforward to the very complex. Given the variety of strategies and solutions available I would always recommend seeking professional advice.”

Karen Barrett, Chief Executive of unbiased.co.uk, comments:

“Many of us want to pass on our estate to loved ones after we’re gone but what people don’t realise is the sizeable tax bill we might also be handing over in the process. As the housing market continues to boom and the IHT threshold remains static, this leaves many more of us at risk of passing on an unnecessary tax bill.

“Planning ahead can mean your beneficiaries don’t pay more tax than they need to as there are many strategies for reducing an inheritance tax bill including wills, pensions, trusts and other tax advice. We have designed our checklist to provide a simple step by step guide for people to help them tackle their inheritance tax planning head on. Anyone who is considering inheritance tax planning may also benefit from the advice of a professional adviser or solicitor. The earlier you seek professional advice the greater the number of options can be used to reduce your IHT liability. To find a whole of market financial adviser or solicitor visit www.unbiased.co.uk.”



Notes to editors:

1. All figures in the unbiased.co.uk TaxAction 2014 report are based on calculations done on unrounded values to guarantee accuracy; text paragraphs display rounded figures.

2. Under current tax rules, life insurance policies are usually free of personal liability, however in certain circumstances the payout may be subject to inheritance tax.

3. unbiased.co.uk’s GetAdvised report was carried out 8 – 11 October 2013 among 2,000 nationally representative UK adults aged 18+

For more information contact:

Anna Schirmer / Emily Falla / Kate Aitchison: 020 7294 3682

For expert commentary or case studies from over 200 media-friendly advisers, journalists should visit unbiased.co.uk Bluebook - the media adviser directory
Twitter: @unbiased_co_uk
LinkedIn: unbiased.co.uk - online networking for professional advisers

About unbiased.co.uk, the professional advice website:

unbiased.co.uk is the UK's most comprehensive free professional adviser search website, focused on empowering users with the resources they need to make better informed financial and legal decisions. We not only help consumers and businesses find the best adviser for their needs from 24,000 IFAs, financial advisers, mortgage advisers, solicitors and accountants listed on our search, but we also help them research the market by providing relevant information and tools. At unbiased.co.uk we are transparent about what we do and provide the easiest way for consumers to find and compare advisers meeting their requirements.

The unbiased.co.uk website launched in 1998 and rapidly became the UK’s leading online destination for consumers and businesses looking to find an adviser. Now attracting over one million visitors a year, unbiased.co.uk is the default adviser directory for consumer websites recommending their audience to ‘find an adviser’.

unbiased.co.uk has launched a new industry-facing website for the adviser community at business.unbiased.co.uk.

Unbiased Ltd promotes the benefits of financial and legal advice to consumers and businesses and would like to thank the following companies for their support:

Alliance Trust



Opinium Research

AXA Wealth


Canada Life Ltd

Royal London

Legal & General  

Santander Asset Management




Standard Life Assurance Limited    


Zurich Intermediary Group

Unbiased Ltd - Registered Office: 12-14 Berry St, London, EC1V 0AU. Registered in England: No. 06775878.


Category: Tax action Tagged: Inheritance Tax

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