Inheritance Tax: A ‘Bypass Inheritance’ Tactic Detailed Amid Sunak Budget Fears | Personal Finances | Finance


Chris mentioned’s strategy as one of the best ways to beat inheritance tax, in his opinion.

The expert recently mentioned a pension error leaving insufficient funds for retirement.

He said: “The best way to get around the legacy is to donate within seven years, that’s good.

“So if you know that you have a wealth of £ 5million and you are unlikely to spend it in your lifetime, put money in trusts or donate to future generations.

“It certainly makes sense to do it sooner rather than later.”

READ MORE: State pension hike to be confirmed tomorrow – but Britons fear ‘permanent changes’

What are family investment companies?

A family investment company (FIC) is a private company managed by family members, other family members owning the shares.

Investment decisions are made by the directors, those who run the FIC.

Parents often play the role of directors, with children or grandchildren as shareholders.

Chris said: “People set up family investment companies for themselves and their children, put assets into them, allocate shares and voting rights to those shares, usually to accommodate future generations.

“It’s getting more and more popular and more and more common now. Whereas before a family office would have been quite large, you would need around £ 10million to set it up and make it useful.

“However, now it is becoming popular for those with lower net worth.”

A CIF operates like a trust fund but is different from a trust fund in that a trust is a separate legal entity in its own right.

Chris said: “With a trust fund, the trust will usually have more control over how the assets are distributed and what happens with them, whereas in the Family Investment Company it will be whoever the shareholders are. and the directors of that company. “

Chris gave readers tips for investing in retirement.

“A younger person I would encourage, if you invest your pension, for example, invest more in stocks now, because you still have a long way to go before you get to retirement,” he said. .

For older Britons, who are planning to retire, investments should be more cautious and less risky.

“Someone who is closer to 60, I would say invest in more conservative assets because they will be less volatile.”

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