Walker Foster assisted a farmer in estate planning to avoid a significant Inheritance Tax (IHT) bill. By taking advantage of the available tax relief and exemptions, we guaranteed no IHT liability upon the client's death, securing his family's financial future.

The Challenges

Our client, a farmer owning a farmhouse and several parcels of working land, faced a complex estate planning situation. His assets qualified for 100% Agricultural Relief (AR), formerly known as Agricultural Property Relief (APR). However, his current will left everything to his wife, who was in the early stages of dementia and unable to assist on the farm. This situation risked losing AR benefits, potentially resulting in a large IHT bill.

Our client’s primary concern was to ensure his sons, who worked on the farm, benefited from the estate while adequately providing for his wife's needs. Without proper planning, his wife’s inheritance could have led to significant IHT liabilities, which is why he sought Walker Foster's expertise to solve these problems and optimise his estate planning.

How Walker Foster Helped

We provided a thorough estate planning solution to address our client's concerns. Our strategic approach involved several key steps and recommendations:

• Transferring assets that qualify for AR and Business Relief (BR) to his sons, ensuring they benefited from 100% tax exemptions.
• Setting up a discretionary trust for the available Nil Rate Band (£325,000) to support his wife, with his sons as ultimate beneficiaries. This trust acts as a financial safety net for his wife while reducing potential IHT liabilities.
• Collaborating with the client's accountant to confirm the AR and BR benefits, ensuring a robust and tax-efficient estate plan.

In doing so, we provided a clear and effective strategy for protecting the client’s assets and minimising tax liabilities.