Wedding Season Gifting / Allowances

As the summer approaches, so does the wedding season, usually at great expense to those involved, including parents.

As the big day arrives, many arrangements and expenses will need to be catered for and it usually a time when parents and grandparents, along with others think about making financial gifts to the happy couple.

Many of our clients and Blog readers will know that thy can gift away £3,000 in a tax year and for this gift to fall outside the donors estate from day one. If they did not use this allowance in the previous tax year, they can go back on year (£6,000 total).

For gifts on marriage, there are additional inheritance tax (IHT) allowances, as follows:

·         From a parent to a child on marriage: £5,000

·         From a grandparent (or great grandparent) to a grandchild on marriage: £2,500

·         Gifts from others as a single amount: £1,000

Further details are available on the HMRC website here: http://www.hmrc.gov.uk/inheritancetax/pass-money-property/exempt-gifts.htm#1

(Chapters Financial is not responsible for the content of external webpages)

You may want to take these gifts into account if a family member is getting married this summer.

You may also want to update your will to reflect this addition to your family and for future offspring. We do recommend that you keep your wills up to date and can recommend a local solicitor if you do not have your own contact/ arrangements.

I hope the day goes well!

If you would like to know more about this planning or your inheritance tax allowances then please contact the team at Chapters Financial Limited on 01483 578800.

No individual advice has been provided in the text of this blog. You should seek independent financial advice (IFA) in your own circumstances.

Keith G Churchouse, FPFS

Director
ISO 22222 Certified Financial Planner
Chapters Financial Limited

Chapters Financial Limited is authorised and regulated by the Financial Conduct Authority, number 402899. The Financial Conduct Authority does not regulate legal advice.

The Cobblers Shoes/ Making or updating your Will

I understand that the saying of the ‘Cobblers shoes’ refers to a Cobbler who turned out fantastic shoes for his customers, but always forgot to shod himself and his family well. There are many ‘life issues’ that come along which some apply the ‘Cobblers shoes’ to. Making or reviewing an existing Will is usually a good example.

I always maintain that there are a few basic financial planning cornerstones that need to be addressed before making use of various planning techniques. Maintaining an emergency deposit fund of 3-6 months’ income to meet any unforeseen demands is one and making (and keeping up to date) a will is another good example, along with trying to enter retirement debt free/mortgage free/repaid.

Referring again to the ‘Cobblers Shoes’ analogy, it has been some years since I reviewed my old will and it is amazing how time flies and both legislation and circumstances change. The original document certainly did not reflect the life changes that had occurred since the original document was finalised and witnessed. A good quality solicitor was employed and a new document, now reflecting my requirements, has been established. I would recommend that you consider the same action if you have not done so for a few years. You might want to make changes to reflect changes in your circumstances, such as the addition of grandchildren or, sadly, the loss of a family member.

If you die without a will in place, you die ‘intestate’. As you can see from the following link, this may not be something you want to happen: http://www.direct.gov.uk/en/Governmentcitizensandrights/Death/Preparation/DG_10029802

Dying intestate may also have negative inheritance tax consequences and you may want to bear this in mind when planning for your future and for that of your beneficiaries. As we have noted in previous Blogs, there are ways of mitigating an Inheritance Tax liability, such as using the annual gift allowance or using surplus income as a means of making efficient gifts away from your estate, documenting these where appropriate. We would recommend that you take individual advice on this subject if it affects you and would certainly recommend that you seek independent legal advice when drawing up a will for your circumstances. Speak to our own legal adviser/ Solicitor or, if you have not sought advice before, we can refer you to a local solicitor to help you with your needs.

Whilst looking at the issue of wills, I am sure your legal adviser will also raise the subject of achieving a Lasting Power of Attorney at the same time. For information, a Lasting Power of Attorney appoints someone (usually someone you know and trust) to make decisions on your behalf when unable to do so for yourself. It should be noted that it can take up to nine weeks to register a Lasting Power of Attorney. More details of the process can be found at the following link: http://www.direct.gov.uk/en/Governmentcitizensandrights/Mentalcapacityandthelaw/Mentalcapacityandplanningahead/DG_186373

The team at Chapters Financial can help you with your Financial Planning and Inheritance Tax Planning and we look forward to working with you. No individual advice has been provided in the content of this blog.

Keith Churchouse, Chartered Financial Planner, Certified Financial Planner
Director, Chapters Financial Limited, High Street, Guildford, Surrey.
Chapters Financial Limited s authorised and regulated by the Financial Services Authority. Number 402899

Chapters Financial Limited is not responsible for the content of external web pages.