Archive for July, 2007
Monday, July 16th, 2007
The initiation of a government consultation into the workings of inheritance tax (IHT) reporting requirements has been welcomed by one industry body.
Assurance firm Standard Life has asserted that recent changes to the treatment of gifts and trusts, as detailed in the 2006 Budget, have meant that many consumers have been forced to file a variety of forms reporting gifts even when IHT should not be levied.
New levels of compliance established last year meant that some trusts, previously potentially exempt, became chargeable, moneymarketing.co.uk reports.
However, new regulation under consultation would mean that forms would not have to be filed for transfers under £210,000, provided no other chargeable transfers had been implemented within the last seven years.
Julie Hutchison, Standard Life Assurance estate planning specialist, remarked: "I welcome this open approach to developing the new regulations.
"The proposed retrospective nature of these rules is a positive step since taxpayers who have made gifts to trusts from April 6th 2007 onwards will be able to take advantage of the new rules when they are finalised."
Last month Standard Life urged widows to seek advice in reviewing their legal and financial affairs, ensuring all such matters are clearly understood in one of the "difficult and confusing times a woman can face".
Posted in Inheritance Tax | No Comments »
Friday, July 13th, 2007
Scottish citizens neglecting to pay fines levied for various offences will be obliged to undertake "hard labour" if they cannot pay, it has been suggested this week.
Yesterday Kenny MacAskill, justice minister at Holyrood, asserted that the 6,000 defaulters currently being given prison sentences each year would no longer serve such terms.
Instead, they will have assets such as cars seized or other financial sanctions taken, while those without the wherewithal to pay will be made to carry out labour in their community.
Mr MacAskill said: "We are seeking to ensure that community sentences will ensure repayment for the harm caused.
"Most of these minor offenders are a nuisance and have to be punished but many communities accept they don’t have to go to prison."
He added that the change would allow prisons to focus on "those who need to be punished", instead of using resources on those who had committed more minor offences.
Earlier this week the Scotsman reported that Mr MacAskill had committed to looking "sympathetically" at the case for increased police funding in Edinburgh.
Posted in Family Law | No Comments »
Thursday, July 12th, 2007
Seeking advice from a solicitor when writing a will can help to ensure that your wishes are carried out as intended, one charity spokesperson has stated this weekend.
Speaking on Wednesday, Gordon Lishman, director general of Age Concern, suggested that writing a will was an important issue and should be carried out with proper diligence.
"Advice from a solicitor will help to ensure that your wishes are carried out as you intended," he contended.
He added that setting out ones wishes could give peace of mind while avoiding later stress for friends and family, who will not need to handle "reams of paperwork" at a later date.
Earlier this month, Age Concern launched a Take Control campaign intended to provide advice to older people about heating and insulating their homes, coordinating efforts for the project with the Home Heat Helpline.
Posted in Wills and Executries | No Comments »
Wednesday, July 11th, 2007
Inheritance tax (IHT) is a problem facing an increasing number of people, but popular methods of avoiding the tax burden are not always viable in every case, one commentator has stated.
Clerical Medical has expanded on its observation that consumers should seek advice about IHT, saying that making gifts is not always possible or favourable.
Nick Williams, chartered tax adviser at the firm, states: "Many people will be faced with the classic inheritance tax dilemma: they have an estate worth more than the nil rate band but can’t make a gift of capital as they rely on it and the income it generates."
He suggested that a number of options remain open to such consumers to mitigate liability, such as the creation of a loan trust, a discounted gift and income trust, or establishing a life insurance policy.
Inheritance tax is currently levied as a rate of 40 per cent of all estates exceeding an exempt band of £300,000, although this is set to be raised to £350,000 by 2010.
Posted in Inheritance Tax | No Comments »
Tuesday, July 10th, 2007
Fresh calls have been made this week to educate the public about the financial risks associated with inheritance tax.
Investment adviser firm Edward Jones has warned that, with house prices continuing to rise, more and more people may unwittingly find their estate breaching the £300,000 threshold for the tax.
Brian Potter, a financial adviser and stockbroker at the firm, remarks: "It’s very easy for an estate to be worth a lot more than the current £300,000 inheritance tax threshold, with tax charged at 40 per cent on everything above this limit."
He added that making a will could help to resolve problems associated with passing on an estate, while the public should investigate their options to minimise the financial impact of inheritance tax should it be applicable.
Last week, Clerical Medical highlighted a number of actions which can alter the amount paid to the taxman, such as] the inclusion of a deed of variation and maximising exemptions and pension contributions.
Posted in Inheritance Tax | No Comments »
Monday, July 9th, 2007
Student leaders in Glasgow have warned that a shortage of houses of multiple occupancy (HMO) in the city is fuelling a housing crisis.
The Glasgow University Students Association has stated that unless planning consent laws are relaxed, the student population could become subject to "ghettoisation".
Commenting on plans to veto the construction of more multiple occupancy homes in the city’s West End, Struan Campbell, accommodation representative for the body, told the Herald that such a move would have "huge consequences" for the university’s students.
"It means students will have to go further out – and if they don’t want to go further out then they are going to have to take properties that are not under HMO."
Because houses not registered as HMO properties are not covered by the same regulations, this could potentially lead to the risks associated with sub-standard housing, he asserted.
Meanwhile Josh MacAlister, president of Edinburgh University Students Association, has claimed that the same housing shortage continues to present a problem to the student population in the capital.
Posted in Estate Agency | No Comments »
Friday, July 6th, 2007
Millions of people are set to learn today that HM Revenue and Customs (HMRC) has requested taxes of them that they did not owe.
The National Audit Office (NAO) has established that errors in processing at the HMRC has led to overpayments of £157 million during the last year, the Herald reports
Meanwhile, HMRC has published a consultation paper calling for powers to take payment directly from bank accounts as well as the ability to require payment from the sale of land or property of non-paying individuals or businesses.
The NAO’s findings suggest that around 500,000 people have been undercharged in the last year, while around 540,000 were overcharged by an average of £290.
Meanwhile, VNUnet.com reports that the institution intends to invest £156 million over the next five years in an IT programme intended to increase calculation accuracy.
Posted in New Legislation | No Comments »
Thursday, July 5th, 2007
The interest base rate has been increased by a quarter percentage point today, it has been announced.
Concluding their two-day meeting regarding the UK’s economic performance, the Bank of England’s monetary policy committee has elected to increase interest rates to 5.75 per cent.
Buyers of new homes may be interested to read about the decision, which is likely to further increase pressure in the housing market.
Commenting on the decision, David Stubbs, senior economist at the Royal Institution of Chartered Surveyors, remarked: "This latest increase in UK interest rates will further dampen housing demand going forward as first time buyers find their borrowing constrained and households who are coming to the end of their fixed rate deals face a big increase in their monthly payments"
He concluded by warning that a further rate rise may follow later in the year, given the ongoing strength of the economy both at home and abroad and the resilient housing market across the UK.
Posted in Estate Agency | No Comments »
Wednesday, July 4th, 2007
Electronic sales conveyancing could add transparency to the house buying process, according to the Council of Mortgage Lenders (CML).
The council proposes that with the legal entitlements in place to undertake sales conveyancing via an electronic medium, more efforts should be made to exploit the benefits of such a system.
In this way, the CML claims that transparency could be added to the process of buying or selling a house in Scotland which was hoped to be achieved in England with the introduction of home information packs.
"There are a number of other ways in which the housing market can be encouraged to work more efficiently," the CML states.
"An example of this is the introduction of electronic conveyancing and we have been urging the government to do more to encourage this."
The CML recently claimed that prime minister Gordon Brown’s target of 200,000 new homes per year is less than the predicted growth in the number of households in the UK.
Posted in Conveyancing | No Comments »
Tuesday, July 3rd, 2007
Careful planning can cut inheritance tax bills "dramatically", it has been advised.
By employing a variety of different techniques, the proportion of an estate lost through inheritance tax may be minimised, according to Clerical Medical.
The pensions and investments provider claims that exemptions and discretionary trusts may eliminate parts of the inheritance from the total on which tax must be paid.
"Good financial advice and planning can help customers reduce their inheritance liabilities by using a simple estate planning strategy," suggests chartered tax adviser Nick Williams.
"It’s relatively simple for people to take advantage of a range of tax exemptions and products to make sure that the maximum amount of wealth is passed to the next generation."
The firm suggests that using a discretionary trust could allow a portion of a legacy to be counted as a debt against the surviving partner’s estate, thus reducing the amount of inheritance tax to be paid when the partner died.
Financial services firm Edward Jones recently warned that inheritance tax is affecting an increasingly wide range of Britons due to rising house prices.
Posted in Inheritance Tax | No Comments »
