Wealth planning: tax-smart ways to build, hold and pass on family wealth

Inheritance tax planning focuses on what your family pays when you die or give assets away. Wealth planning looks at the whole life cycle: tax on income and gains while you build wealth, how you take money out in retirement, which structures hold which assets, and then how it passes on. Inheritance tax is one chapter. We plan all of them so choices in one do not undermine another.

A financial planner chooses investments and products and is regulated for that. A tax adviser works out the tax consequences and designs structures, gifts and reliefs. High net worth families usually need both working together. We are tax specialists: we work alongside your investment manager, accountant and solicitor so the tax design and the investment plan support each other.

The main ones are your personal allowance of £12,570, the £500 dividend allowance, the £3,000 capital gains tax exempt amount, the ISA allowance of £20,000, and pension contributions within your annual allowance. For inheritance tax, you also have the £3,000 annual gift exemption. These reset every 6 April, and most cannot be carried forward, so unused allowances are usually lost.

Transfers between spouses or civil partners who live together are generally free of capital gains tax and inheritance tax, so assets can be moved to make the best use of both people's allowances and lower tax bands. That can mean splitting investments, dividend-paying shares or rental income. Moves must be genuine gifts, and the effect on your plan for the longer term needs thought.

Pension contributions attract tax relief, and growth inside the pension is largely tax-free. The annual allowance is £60,000, tapered for very high earners. Until now many families have left pensions untouched as an inheritance tax shelter. From 6 April 2027, most unused pension funds count in the estate, so the order in which you draw on pensions and other assets needs reviewing.

For deaths on or after 6 April 2027, most unused pension funds and death benefits will be included in the estate for inheritance tax. Death-in-service benefits and dependants' scheme pensions are excluded, and the spouse and charity exemptions remain. Personal representatives will be responsible for reporting and paying. If your plan assumed pensions were outside your estate, it needs updating.

It depends on your income needs, time horizon and goals. Personal ownership is simplest and keeps your allowances. A company or Family Investment Company pays corporation tax and suits long-term growth for the next generation. A trust suits control and protection. Each has different tax on income, gains and death. We model the options against your numbers before you move anything.

We plan disposals to use your £3,000 exempt amount and lower rate band, where individuals pay 18% or 24%, and share gains across spouses. We also look at timing, losses, reliefs and the effect of death, when gains are wiped out by the market-value uplift. Transferring assets for inheritance tax reasons can trigger a gain, so we weigh both taxes together.

Yes, with the right structure. Outright gifts give up control. A trust or a Family Investment Company can allow you to give, for example, growth shares while you keep voting control or act as trustee. The tax rules on retaining benefit are strict, so you cannot keep using the asset for free. We design the balance between control and tax.

Care costs can reduce the size of an estate, and giving assets away early may not achieve what people expect, particularly if you keep benefiting from them. Planning needs the whole picture: income, property, pensions and family needs. We explain the tax effects so you can decide with your solicitor and financial planner.

Gifts to charity are exempt from inheritance tax, and leaving at least 10% of the net estate to charity reduces the rate on the rest from 40% to 36%. During your life, Gift Aid and gifts of shares or property can give income tax and capital gains tax relief. Giving works best when planned in your will and your annual tax position together.

Moving can change your income tax, capital gains tax and inheritance tax. Inheritance tax follows long-term UK residence, which means being UK resident for 10 of the previous 20 tax years, with a tail after you leave. Leaving can also trigger temporary non-residence rules for gains. You need advice before you move, so the plan works on both sides of the border.

Review it at least once a year, around the tax year end, and whenever something big changes: a sale, an inheritance, a marriage or divorce, a child reaching adulthood, retirement, a move abroad or a change in the law. A short annual check is usually enough to keep allowances used and structures on track. Larger events deserve a proper re-plan.

Business owners often hold most of their wealth in the company, so planning looks at how profit leaves the business, how pensions and other assets are built outside it, and what happens on a sale or succession. Reliefs such as Business Relief for inheritance tax and Business Asset Disposal Relief for capital gains tax may apply. We join this up with your corporate planning.

There is no set minimum. Our wealth planning suits anyone with enough assets, income or complexity that tax planning would make a real difference, often because of a home, a business, investments or a pension. A free first call will tell you whether planning is worthwhile for you, and we will say if it is not.

A rough list of your assets and debts, your main income sources, your pension values, any existing wills, trusts or company shares, and a note of what matters most to you, such as passing on a business or funding grandchildren. Figures can be approximate. The call is free, and we use it to decide what is worth looking at in more detail.