It occurs\u00a0to me that we are in somewhat\u00a0of a No Mans Land at the moment.<\/p>\n
The autumn budget bombshell is fading into the rear-view mirror although the impact of many of the measures\u00a0is still not totally clear.<\/p>\n
The changes to pensions death benefits are arguably the largest issue impacting on our Estate Planning and this is the area where there is perhaps still the greatest uncertainty.<\/p>\n
The Budget announced the changes at a high level and then put the detail out to consultation. That consultation\u00a0ended in January and the usual 3-month period for the Government to respond has already come and gone without so much as a mention.<\/p>\n
<\/p>\n
HMRC now informs us that the consultation\u00a0response and any draft legislation will follow “later this year” – take that to mean what you will.<\/p>\n
None of this does anything to help people plan for the future and there remain some key questions still to answer. The mechanism for pension funds to pay the IHT due is fraught with difficulty.<\/p>\n
Firstly, executors will be expected to complete complex calculations to apportion the IHT due on the pension fund (compared to the estate as a whole) and then inform pension scheme administrators. All of this to happen within 6 months of someone passing away. I can see many issues on this point alone, not least the very real possibility of people getting it wrong despite their best intentions.<\/p>\n
Beyond that there are questions of how pensions will pay the funds when they consist of illiquid assets (such as commercial\u00a0property).<\/p>\n
Finally, there still seems to be hope in some quarters that the Government will perform some sort of spectacular U-turn and scrap these changes completely. On this point I must say I feel it is wishful thinking, but you can never say never.<\/p>\n
All of this leaves individuals and families in a bit of a quandary. Do they begin to make changes to their planning now based on the rules we are 99% sure will come into play in a couple of years\u2019 time – potentially delivering better long-term outcomes but creating short term risk.<\/p>\n
Or, on the other hand, do people do nothing for the moment and simply bide their time until things become clearer, potentially missing out on the opportunity to mitigate some of the impacts in the process.<\/p>\n
The answer to this conundrum\u00a0is not straightforward\u00a0and will likely vary from one client to the next depending on their views on the legislation, their goals and priorities and their risk attitude. Please don’t even get me started on the possibility of another Government winning power and changing everything again in 4 years\u2019 time (and this looks like a real possibility\u00a0now based on the polls).<\/p>\n
All this just highlights the need for high-quality advice, guidance and wisdom in this area. In a world where we don’t have perfect information, it is so vital to have a high-quality conversation about the options available and the relative pros and cons of each so that an informed decision can be reached based on what we know today.<\/p>\n
Fortunately, that is exactly what we offer here at Buckingham Gate. If you would like a consultation to discuss your own Estate Planning in detail, please don’t hesitate to get in touch with our friendly team.<\/p>\n","protected":false},"excerpt":{"rendered":"
It occurs\u00a0to me that we are in somewhat\u00a0of a No Mans Land at the moment. The autumn budget bombshell is fading into the rear-view mirror although the impact of many of the measures\u00a0is still not totally clear. The changes to pensions death benefits are arguably the largest issue impacting on our Estate Planning and this… Read more »<\/a><\/p>\n","protected":false},"author":5,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-3518","post","type-post","status-publish","format-standard","hentry","category-uncategorised","wp-sticky"],"_links":{"self":[{"href":"https:\/\/www.buckinghamgate.co.uk\/blog\/wp-json\/wp\/v2\/posts\/3518","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.buckinghamgate.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.buckinghamgate.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.buckinghamgate.co.uk\/blog\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/www.buckinghamgate.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=3518"}],"version-history":[{"count":1,"href":"https:\/\/www.buckinghamgate.co.uk\/blog\/wp-json\/wp\/v2\/posts\/3518\/revisions"}],"predecessor-version":[{"id":3519,"href":"https:\/\/www.buckinghamgate.co.uk\/blog\/wp-json\/wp\/v2\/posts\/3518\/revisions\/3519"}],"wp:attachment":[{"href":"https:\/\/www.buckinghamgate.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=3518"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.buckinghamgate.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=3518"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.buckinghamgate.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=3518"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}