A recent tax case has highlighted the need to review wills regularly and to ensure that they continue to provide what is intended.
As mentioned in the earlier article on IHT planning, it is recommended practice that married couples and civil partners use both of their IHT nil-rate bands. This may include a provision in both wills to create nil-rate band discretionary trusts, which include the surviving spouse as a beneficiary, helping to allay fears over future financial security.
The arrangement works very well if there are surplus assets, but more and more couples are being brought into the IHT net because of the increasing value of the matrimonial home. In such cases, the practice is for the trust to be established by means of the surviving spouse succeeding to the property in exchange for a debt or by charging the property to the trustees.
