Nearly two out of three (63%) of advisers have reported encountering family disputes while assisting with Inheritance Tax (IHT) planning, new research* from Downing shows.
Our study with advisers and wealth managers found family disputes are more likely during IHT planning than when estates are settled – just 26% questioned said they had experienced family tension over estates.
However, only 11% questioned said they had never experienced any family disputes over either IHT planning or estate settlements, possibly due to the general approach of almost all advisers ensuring that families are involved in IHT planning from the start.
Most wealth managers and advisers regard involving clients' families in IHT planning as beneficial to their business
Around a third (30%) said they always ensure other family members are involved when clients initially contact them about IHT planning and a further 58% say they usually do, while 10% say their first meeting is with the client before involving other family members. Just 2% say their policy is exclusively to communicate with the client.
The study found that most wealth managers and advisers regard involving clients' families in IHT planning as beneficial to their business. Around 74% of those questioned believe that involving family members in IHT planning is an important part of growing their business, while another 23% agree that while involving family is beneficial to their business, it is not the only reason they do so.
Mark Dunn, Head of Retail Sales at Downing says:
“Inheritance can be emotive for families and that is certainly reflected in the experience of advisers.
It is striking that advisers see more family disputes during IHT planning rather than over estate settlement, possibly demonstrating the wisdom of involving families from the start.
It is also generally good for adviser businesses to involve family members in IHT planning as it introduces the adviser to the next generation which could help make them a client in the future.”
Downing’s IHT planning solutions aim to provide IHT relief after two years if held at the date of death by giving investors the opportunity to invest in Business Relief-qualifying businesses.
The Downing Estate Planning Service invests predominantly in asset-backed trading businesses, in sectors such as care homes, renewable energy and lending to property developers. The Downing AIM Estate Planning Service invests in a diversified portfolio of 25 to 40 companies that are listed on AIM, and is also available in an ISA wrapper.
Sources:
*Downing commissioned independent research company PureProfile to interview 100 UK financial advisers and wealth managers using an online methodology during November 2024.
Important notice
Opinions expressed represent the views of the author at the time of publication, are subject to change, and should not be interpreted as investment or tax advice.
This article is for investment professionals only. This article is for information only and does not form part of a direct offer or invitation to purchase, subscribe for or dispose of securities and no reliance should be placed on it. No reliance should be made on this content to inform any investment of tax planning decision.
This content contains information that is believed to be accurate at the time of publication but is subject to change without notice. The explanation of all of the tax rules set out have been written in accordance with our understanding of the law and interpretation of it at the time of publication.
Whilst care has been taken in compiling this content, no representation or warranty, express or implied, is made by Downing as to its accuracy or completeness, including for external sources (which may have been used) which have not been verified.
