The financial details

Pension income –  £13,000 per annum

Total assets –  £650,000; £250,000 in cash, £400,000 invested

The personal details

  • Single lady, age 84
  • Inherits a large amount money
  • Doesn’t really understand financial matters, found having so much money a burden
  • Very risk averse
  • Keen to utilise capital to generate additional income
  • Wanted to pass on assets, worried about inheritance tax implications

Our solution

  • In conjunction with our client’s solicitor, we invested some of the capital into two tax efficient trust arrangements. This immediately reduced the size of the taxable estate
  • Withdrawals from the trust increased our client’s income and not income tax
  • We reduced the level of risk in the investment portfolio in line with our client’s preference for low risk
  • Our client’s solicitor was appointed as trustee to the trust.

The outcome

  • Significant protection from Inheritance Tax
  • The value of the estate will reduce still further over the next seven years reducing Inheritance Tax liability still further
  • Our client’s income was increased by £625 per month, tax efficiently

Our client has the peace of mind that she has a professional team looking after HER interests.