Malcolm Finney examines whether deathbed inheritance tax planning is a myth.
Deathbed inheritance tax (IHT) planning, for many, conjures up an image of an individual lying in bed, slowly dying, desperately trying to sort out their tax affairs before the grim reaper takes them to a far-off land.
It might be suggested that any individual attempting to carry out such important planning is perhaps leaving it a little too late and cannot possibly be effective. Nevertheless, perhaps surprisingly, such planning can, in fact, prove to be highly tax-effective.
Inter-spouse deathbed gifts
An effective but classic deathbed plan is referred to in HMRC’s ‘General Anti-abuse rule (GAAR) guidance Part D Examples’ at paragraph D19 (‘Gifts between spouses’). Mrs Jones is terminally ill. Mr Jones gives his shares, which are standing at a
