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Tax probate and how to navigate the process

Your Beneficiaries And Inheritance Tax: How To Effectively Navigate The Probate Process

By David Pritchard


Benjamin Franklin once stated, “… in this world nothing is certain except death and taxes.” Beyond this statement’s gloom, it holds true, especially in today’s world where inheritance tax has become a significant, unavoidable part of most estates. On a recent episode of our podcast, A Dab of Investment, I discussed how we help our clients at Applewood Independent navigate the murky waters of probate processes.

How do you pass on your estate to your beneficiaries without losing a lot of it to taxation?

Inheritance tax: what it means for your beneficiaries

Inheritance tax has remained static since 2009, with no sign of changes on the horizon for inheritance task rules. But despite its stative nature, it has wielded – and will continue to wield – a significant impact on all of us. 

IHT started out as a tax for the ‘very wealthy individuals.’ However, with the threshold being frozen and other factors such as house price increases coming into play, many more executors may have to pay off thousands (or hundreds of thousands) in inheritance tax.

In accordance with IHT rules, each person in the UK may be able to leave a tax-free allowance of up to £325,000 to their beneficiaries. Sounds fantastic, doesn’t it? However, the main catch to be aware of is that if you’ve allotted gifts to the beneficiaries within the last 7 years, this could create a twisted web that results in your executors paying inheritance tax.

But there’s light at the end of the tunnel, after all. The residence nil rate band (a new allowance which has a threshold of £175,000) is available to anyone if the family home is passed onto direct descendants such as children, grandchildren, etc. This could potentially increase the inheritance tax exemption threshold to £500,000 or £1 million for couples. 

Finding options for inheritance tax planning

At the moment, there are a wide range of options available for people who want to undertake IHT planning in the most seamless, tax-efficient way possible. 

Most people choose to go down the frequently trodden  – and efficient – path of gifting their assets away during their lifetime to lower the estate’s value, causing their beneficiaries to be exempt from inheritance tax. However,  there are other alternatives available such as trusts or life insurance policies, and of course, tax-efficient investments. 

The latter is fast-becoming a significant part of IHT planning as it opens the door to many opportunities. For instance, some aspects of the current regulations allow investments to go into the AIM  – Alternative Investment Market. This offers individuals a leeway since any investments held there at the time of death are outside the individual’s estate and can be passed on tax-free, provided that they held the shares for at least two years prior to their death. 

How Applewood Independent comes in

Regardless of the allure that comes with each inheritance tax planning strategy, independent advice remains the gold standard for anyone going down this path. Inheritance taxation is every bit as complicated as it looks and comes with several pitfalls. Do you really want to navigate this tangled web without a guide to advise you or at the very least, hold your hand?

At Applewood Independent, we’ve spent the past 25 years assisting the probate process for numerous clients and their estates. Our major goal is to aid your beneficiaries and executors to carry out the probate as efficiently as possible. Whether it’s probate valuation or handling the intricacies of your flexi access drawdown (which we’ve discussed in a previous blog), we’re committed to ensuring that everything is passed on to the right person(s) at the right time. 

If you’d welcome our input, expertise and experience, please get in touch by emailing me at

The views expressed in this article are those of the author and do not constitute financial advice. Applewood Independent Ltd is authorised and regulated by the Financial Conduct Authority. For financial advice designed for you and your specific circumstances, please contact the author using the contact details provided in this article or, alternatively, contact the Applewood Independent Ltd office on 01270 626555.

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