Inheritance Tax - Need to make a will?

Hi,
I've been told that if you don't make a will, if your estate is over some amount, 250K I believe, the government takes the rest or wants 40% of the
rest? Is this true? My wife and I live in the south east, and not surprisingly, our house is worth around this figure, so I'm a little concerned, should I die (the house is in my name) that she might get a large tax bill, if I do not make a will. Surely this is not right?
To complicate matters slightly, my wife is not English, so is not domiciled here for tax purposes.
Kind Regards, Shane Cook.
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Shane Cook wrote in message ...

large

Have a look at http://www.tenminutewill.co.uk/ I'm not advocating internet wills but this outlines the situation for married couples pretty well.
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Hi, The nil rate band is now at 263K. All gifts and transfers on death between spouses are IHT exempt. It is on the death of the remaining spouse that IHT might be accountable, depending on the value of the estate. As you are the sole owner you should still make a will giving your spouse a life interest and right of residence in the property. If you die intestate(no will) your wife does not have an automatic right to stay in the home. poppy

large

domiciled

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writes

DONT do this. This creates an interest in possession for your wife and she will be taxed as though it were her own house on her death, even though it doesnt belong to her.

Why not? Doesnt she live with you?
--
John Boyle

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So how SHOULD I ensure she is able to live in our family home, which I bought, by myself, before we even met or got married, should I die for whatever reason before her?
The best solution I've found to date is a discretionary trust will, as detailed at http://www.tenminutewill.co.uk/pdffiles/discretionary_trusts.pdf

No, she has business interests abroad, and our accountant advised her to register as not being domiciled in the UK, so we'd only pay UK tax on money she brings (remits) to the UK, not whatever money she makes abroad. I brought this issue up, because I believe there is some sort of different treatment for IHT or gifts between husband and wife should either partner not be domiciled in the UK. She rents out a house she used to live in there, and then uses the money when she's abroad. I suppose she should probably make a will too.
Kind Regards, Shane Cook.
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That is a biut dangerous becuase some of the schemes it advocates to allow the surviving spouse to have access to the trust assets are now under threat from the Capital Taxes office which would regard some of the the schemes as leaving the spouse with an interest in possession, and therefore taxable as though they owned the assets in the trust.
The best way is to leave your dosh to a trust and leave the house to her but let the trust accept an IOU from her to the value of the house.. It is v.important that the house does NOT go into the trust but directly to her. The will needs to specifically allow the trust to accept an IOU in lieu of the value of the house.

So she is paying Income Tax on a remittance basis?
--
John Boyle

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Yes and no. She pays income tax from her job here in the UK, and doesn't actually bring any money into the UK, so pays no actual tax on a remittance basis, although she would do, if she brough the money to the UK. Does it make a difference?
Kind Regards, Shane Cook.
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<snip>

money

there,

I assume you have in mind the restriction of the inter spouse exemption to 55,000 where the transferee is of foreign domicile?
--
Doug Ramage

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No, I thought ANY transfer of assets between husband and wife, where one or other were not domiciled in the UK was subject to CGT and/or IHT. I know nothing about this 55K exemption. Please explain. Thanks.
Kind Regards, Shane Cook.
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to

different

partner

probably

to

or

My earlier post was for IHT purposes only.
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Depending on whether the house is held as joint tenants or tenants in common. In many marriages the house (or even 50% of the house) doesn't even form part of the estate of the first of the couple to die - thereby wasting most of a nil-rate IHT band.
--
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