Case Studies


Inheritance Tax planning

Susan is 80 and has dementia. She is now in a care home. She has a Lasting Power of Attorney (LPA) and has nominated her only son Brian to look after her affairs. Her estate is valued at £1.5m and Brian is worried about Inheritance Tax (IHT) liabilities (£470,000) that will arise on his mother’s death. The LPA does not allow gifting therefore limiting potential solutions. We are able to invest a large proportion of the estate into a product which becomes totally exempt from IHT after 2 years as well offering the option to pay for care fees if required.

Pension planning

 Peter is 60 and has 7 personal pensions each with a different pension provider and with a combined value of £1,000,000. He wishes to simplify his pension arrangements to make his paperwork more manageable, as well as releasing a cash lump sum in order to pay off his mortgage. He doesn’t require any pension income at present as he intends to continue working. He also doesn’t want to pay higher rate tax on pension income he doesn’t actually need anyway. We are consolidating all the pensions with a single pension provider that allows drawdown. At the same time we are arranging for the tax free Pension Commencement Lump Sum to be paid (£250,000) so that he can clear his mortgage balance.

Investment planning

Paul is 60 and is about to take his pension. He can live comfortably on the income but needs to make sure that the lump sum accompanying his pension keeps its value. As a result he is able to make substantial gifts into trusts for the benefit of his grandchildren.

We have arranged ISA investments for Brian and also his wife to maximise their annual allowances. The balance is invested in accounts that can be switched to ISAs when the new allowances become available when the new tax year starts next April. They will continue doing this until all of their nest egg is sheltered in ISAs. This will mean that any income they then take or capital they withdraw will be completely free of all taxes.

All of the above case studies are example scenarios. Before any personal recommendation can be made a full investigation is carried out taking into account clients needs and objectives.