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TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15976
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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My elderly parents each own 50% of the family home (it is not

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My elderly parents each own 50% of the family home (it is not owned jointly). The home is valued around £450,000 and they each have a small amount of other assets. What do they need to do to minimise IHT.
Sadly it very likely that one my die within the next 12 months so he is keen to get this sorted.

So long as they each have wills which will leave their respective shares of the family home and other assets to one another, there should be no IHT problem.

Firstly, when a spouse who dies leaves their assets to the surviving spouse there is no Inheritance Tax as intra spouse transfers are exempt from IHT which means that the spouse who dies first, does not use their Inheritance Tax nil-rate band.

When the second spouse dies, their executor will be able to make a claim for the transfer of the unused nil-rate band from the spouse who dies first which could double the nil-rate band of the spouse who dies last to £650,000.

Take a look here for information on transferring an unused IHT nil-rate band.

I hope this helps but let me know if you have any further questions.
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