So, let’s have a change from life insurance.
And let’s start with a question, a bit of a silly since the answer appears below but anyway.
What is the biggest improvement to inheritance tax legislation that we have had recently?
Is it the new (don’t plan on this one until next April and even then it is being phased in over the next 4 years) domestic property extra bit to allow an additional up to £175,000 per capita which can be shared in the case of legal couples that will thus top the maximum total IHT tax free allowance up to £1,000,000 for a couple by 2020?
But beware if you or your house are worth too much because that will taper down to zero between total estate between £2,000,000 and £2,700,000.
Or is it the new pensions freedom rule that allows your children to inherit your pension and to do so inheritance tax free if they are not so stupid as to to cash it in?
Is it the possibility of inheriting your ISA portfolio free of inheritance tax provided you converted to qualifying AIM investments 2 years or more before your death. If you have been taking up your full PEP and latterly ISA allowances over the years this could easily be a six figure number, and your estate will still get its full IHT allowances?
This will of course depend on individual circumstances, and it is definitely the AIM ISA portfolio or the inheritable pension. These will both be entirely outside your estate, leaving the full £325,000 to (£425,000 to £500,000 per capita phased from 2016 to 2020) for your other assets.
Only time will tell, but I suspect that more will benefit from the pension inheritance than the AIM portfolio ( and that can include AIM shares outside the ISA as well).