Inheritance Tax UK: Britons urged to take ‘fundamental’ actions to eliminate a tax bill

Most significantly, however, is the so-called ‘seven year rule’ which outlines how Britons can give gifts away.

Gifts handed over in the three years before a person dies are charged at 40 percent, but tax paid will reduce slightly the longer between a gift given and a person’s death, until the bill is eliminated at seven years. 

There are, though, other elements of IHT to consider, and Ms Julian highlighted the best way to make sure this is considered is through a Last Will and Testament.

She added: “Having a valid Will in place is one of the most fundamental and straightforward ways of ensuring as much as possible of your Estate goes to those intended.

“It is important also to keep it periodically under review in case circumstances change. 

“Typically, after seven years, the gift falls outside of the Estate, and within that timeframe, the potential tax on the gift can taper down after three years of making the gift.

“The rules here can be more complex, so it is wise to seek financial advice from a Wealth Planner.

“In addition to all the above, there are a number of alternative ways of ensuring one’s estate is preserved for their nearest and dearest.

“These are included, but not limited to: insurance, various types of Trust planning, and forms of investment, which can qualify for an IHT exemption after two years of holding.”

Ms Julian, however, concluded by stressing the importance of seeking financial advice before making any major decisions.

This, she said, is due to the fact some of these solutions will be more important than others, dependent on a person’s circumstances.

This is particularly important for individuals who have a complex situation which necessitates more support than the basics.