Case studies

Inheritance tax planning saves £124,000

A client wanted us to do some inheritance tax planning on their estate. 

The client was a divorced man in his late sixties with one daughter and two properties – one that he lived in and one that he rented out.  He had already worked out that he had to pay over £160,000 in inheritance tax upon his death on the sale of his rental property, but he did not want to burden his daughter with such a large debt and asked us to try and mitigate this.

We worked out that by making a principal private residence election on the rented property (he lived there, moved to his current house, then rented his old house to tenants), claiming a lettings exemption, his capital gains tax exemption and undertaking further tax mitigation, he could gift the property to his daughter and pay just £36,000 capital gains tax – a saving of £124,000!

Wilkins Southworth - case study