Legacy Release Helps Clients Navigate Troubled Estate Tax Waters


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A big tax bill at the start is the last thing you want when dealing with a complex inheritance. Legacy version can help customers navigate those rough waters

‘One of the reasons The old version exists is to help our clients cope with the problem of having to pay inheritance tax before actually receiving their inheritance, ”explains Simon Dawson, Commercial Director of the company.

This is a situation, he explains, which sometimes happens to HNW customers due to an issue in UK probate rules that require inheritance tax to be paid before a probate clearance can be issued. granted. This can pose particular problems for asset-rich and cash-poor beneficiaries, who may end up with a bill that exceeds their cash flow at the time.

The more complex the field, says Dawson, the greater the risk of other problems. “Recipients are likely to have different priorities, and while some may be happy to wait, others may need to access their inheritance earlier, perhaps to pay for school fees or a wedding. “he said. “In other cases, it may be necessary to hire a forensic accountant to trace the assets, or a lawyer who is unable to work off-line. These may not be testamentary costs, which means they cannot be taken out of the estate.

Under such circumstances, he tells Spear’s, Legacy Release can provide HNW clients with a quick and timely loan up to 70 percent of the estate. As the loan is secured by the value of the estate itself, rather than the credit status of the beneficiary, the money can be arranged reliably and quickly without complications.

Dawson would like to point out that the company’s loans are completely unconditional. “The advance can be used for almost any purpose,” he adds. “What matters to us is that the customer has the money when they need it most. In return, borrowers pay a lump sum of 2% of the amount borrowed, with a monthly fee of 1.35% taken from the balance. Payment is taken from the estate after probate has been paid.

With a background in litigation loan, Dawson draws parallels between the world of divorce loans – now an established part of HNW family law – and the emerging field of estate loans. “We are one of the few companies in the market here,” he adds. “We understand the complexity of the problem and the simplicity of the solution. “

While large retail banks previously offered specialized estate release loans, these offers have been curtailed in recent years. Part of the reason, says Dawson, is the heightened level of risk for lenders, especially when it comes to assessing large and complex areas. “As a lender, it’s entirely up to us to assess the value of the estate,” he says. “We do not require any personal guarantees or security because we bear the burden of risk. Since the loans are based on real assets, the risk of default is minimal.

As one of the emerging leaders in the field, Legacy Release recently received the support of a major financial partner backed by significant private equity. Dawson hopes this will help the company expand its presence and the estate loan market itself.

With a specialist firm providing execution services only to HNW clients, the proposal currently falls outside the regulatory orbit of the UK’s Financial Conduct Authority. One of the benefits of this, Dawson says, is the added agility it brings, as the company is able to lend quickly without any delay.

“As we develop our offering, we will almost certainly seek FCA approval,” he says. “At the moment, however, our focus is on the HNW community. And we know our customers value our ability to act as quickly as possible. ‘

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