ings and a car worth #10,000 and owed #5,000 including funeral bills, your estate would be worth #305,000 net. Thats #30,000 above the tax threshold on w
hich youd pay #12,000 tax. Q: How long have you got to pay it? A: Payment is due six months after the end of the month in which death occurred. Q: What if the house has to be sold to pay the tax? A: Interest is charg
ed on any tax not
paid by the due date, no matter what caused the delay. Q: What if I leave everything to my spouse? A: Everything left to a spouse is tax-free. But when the survivor dies, your children may be liable. Q: What if we each leave half the house to our children? A: If your spouse continues living there rent-free, the taxman may say he or she owns it. Q: Can the tax be reduced? A: Yes, theres a lot you can do. Anything given away seven years before you die is exempt from tax, for example. Q: What if you give money away but die within the seven years? A: The tax is staggered over the seven years so youd still save some money. Q: What other concessions are there? A: A husband and wife are each allowed to give away up to #3,000 a year wit
hout tax being paid on it. You can also offer an unlimited number of gifts of #250 or less. In addition you can make wedding gifts of up to #5,000 to each of your children, and up to #2,500 to each grandchild. Q: What if I leave money to charity? A: All outright gifts made to charities are completely free of inheritance tax. Q: Are there any other ways to minimise the potential tax bill? A: You can also put money into a trust for the benefit of your children or grandchildren, for example. Whatever you do, consult an independent financial adviser. They can also help you draw up a will. Joyce Rahn is head of IFA Services at Norwich Peterborough.