• A choice of products will be available for first time buyers across the core range, affordable housing, Help to Buy / First Buy, NewBuy and MI New Home products
• Cashback amount will equate to between £1,500 and £2,500
• The pament will be made to the conveyancer on completion

For more information on this please call us on 01932 865500 or email us at enquiries@jmlassociates.co.uk

And without proper financial planning and professional advice, HM Revenue & Customs (HMRC) can become the single biggest beneficiary of your estate after you die.

Careful Inheritance Tax planning means passing as much of the proceeds of an estate as possible to chosen beneficiaries rather than the taxman. There are several perfectly legal ways of doing this. And with the Government changing course on IHT policy, the need for such planning has come into much sharper focus.

Before the last election, the Conservatives had proposed a dramatic rise in the IHT threshold – the amount up to which an estate will have no Inheritance Tax (IHT) to pay. Now, the Coalition Government has changed tack with Chancellor George Osborne announcing that the nil rate band of IHT of £325,000 per person (or up to £650,000 per couple, where the full allowance has been passed to the surviving spouse) will be frozen until 2019.

This means more estates will be sucked into the 40% tax rate. Inheritance Tax is a tax on assets, and with the increase in property prices over the last decade, this tax is now a problem increasing numbers of people have to consider.

And it is not just the family home that is taken into account. Assets such as Individual Savings Accounts (ISAs), life assurance plans not in trust and even old family heirlooms might have to be sold in order to meet tax liabilities after death. The impact on a relatively modest estate can be both dramatic and upsetting.

The average amount of Inheritance Tax raised each year is £3.0bn*.

It is quite straightforward for people to ease their potential exposure to IHT, yet few still seem prepared to grasp the nettle. By not preparing, however, they are effectively leaving their children and grandchildren to sit down one day and write a very large cheque to HMRC.

Here are some of the simple options available to help lessen IHT:

• Make a Will and that it is written and planned correctly to save the maximum amount of tax
• If you die without making one, you will have no control over how your assets are distributed
• Transfer assets through the prudent use of lifetime gifts
• Create a tax-efficient fund to enable the beneficiaries of an estate to meet the tax liability without disturbing the family wealth

Many exemptions and allowances exist to minimise the effects of IHT. Some of the most valuable exemptions must be used seven years before the donor’s death, so it makes sense to consider ways to mitigate IHT sooner rather than later. For example, gifts made more than seven years before the donor dies are entirely free of IHT.

Pensions can also play a considerable role in estate planning. Death benefits under modern pension plans are broadly exempt from IHT although a liability to periodic and exit charges can arise in a limited number of circumstances. Also, adequate retirement income with spouse or civil partner and dependant’s pensions may release capital for lifetime giving.

Although pension death benefits are broadly exempt from IHT, if they are passed to your survivor they will form part of their estate.

Family trusts can provide an effective way of sheltering assets from IHT, again as long as the donor survives seven years – and they are not designed simply for the wealthy. Loan Plans are the most flexible because nothing is being given away. The original capital lent to the trustees can always be taken back, perhaps to pay for care fees.

Another way to lighten the IHT burden is via the Alternative Investment Market (AIM) where assets can be converted into a portfolio of qualifying AIM shares. Once they have been held for a minimum of two years, they can be placed in a trust. By doing this, an unlimited amount of funds could be placed in a discretionary trust, without giving rise to an immediate IHT charge.

It should be noted that this type of investment, however, does carry a high level of capital risk. Many smaller companies whose shares are traded on AIM are more uncertain than larger ones, running the risk of getting back less than you invested, which means that this form of investment will not be suitable for the majority of people and professional advice should be sought.

People with substantial incomes who make a habit of distributing some of it can dramatically cut their tax bills via gifting. For these gifts to be IHT-free, they must be made out of income, they must be intended to be regular, and they must not reduce the donor’s standard of living.

Other specialist IHT allowances and exemptions may benefit some families. For example, complex rules govern business property and agricultural land reliefs, but where these reliefs apply they remain of exceptional value. The rationale behind these substantial reliefs is to try and ensure that family businesses or partnerships do not have to be split up and sold to pay a tax liability on the death of one of the principals. There are certain conditions which need to be satisfied, so professional advice is vital in this complex area.

Life assurance written in trust can also be a highly effective way of protecting your family from the effects of IHT. A lump sum payable on death gives the peace of mind that the family will have sufficient funds for their own use when you are gone. This may help towards the purchase of a first house or help provide school or tuition fees for children and grandchildren. Additionally, life assurance can even create your legacy. Creating a legacy in this way will allow you to spend more of your own funds in later years without feeling you have disinherited your children or grandchildren in any way.

As can be seen, a number of solutions are available to mitigate the potential effects of IHT.

The calculation is simple. Count up the value of all the assets remaining on death, subtract the current £325,000 nil-rate band or threshold – and what is left is taxed at 40%. Specialist advice can still ensure that as much of your estate as possible stays out of the taxman’s grasp, so it makes sense to act sooner rather than later to ensure that your heirs are not subject to a hefty bill on your death.

You should be aware that the levels and bases of taxation and reliefs from taxation can change at any time and are generally dependent on individual circumstances.

Trusts are not regulated by the Financial Conduct Authority.

 Sources

*HMRC – July 2012

Free valuation

All customers, including first time buyer customers will receive a free valuation for mortgage purposes (up to a property value of £2.5 million) – provided by Abbey’s Group Survey Office.

Their partner e.surv will contact all purchase customers to make them aware of the range of RICS surveys including Condition Report, Homebuyers Report and Building Survey. Where a more detailed survey is requested by you, they will only need to pay any additional fee for upgrading the basic survey.

£250 cashback

All customers will receive £250 cashback at completion, as a contribution towards legal costs.

They will also be reducing the rates on a number of Fixed rate and Tracker products including their 5 year Fixed rate NewBuy product.

 To discuss this or any other First Time Buyer mortgages please call us on 01932 865500.

 Are you a company director? Do you have life insurance in place to protect your family?

 If so you could be paying an unnecessary tax penalty. If you pay for this cover from your own bank account you will be paying from post-tax income, and if you are paying from the business account you will probably be taxed on the payment as if it were income.

 Larger companies can avoid this by introducing ‘group death in service cover’. This is a highly tax-efficient way of providing life insurance, but is not generally available for smaller companies.

 However, recent changes in legislation have allowed small companies to benefit from this arrangement by taking out ‘relevant life policies’. These can be written on an individual basis so are available to all companies no matter how small.

 The tax benefits are:

 Payments are made by the company with no benefit-in-kind charge back to you

• No National Insurance implications
• Possible tax relief as a business expense depending on your individual circumstances
• Tax-free benefits to your dependants

 If you would like more information on how this valuable tax concession can be arranged then please contact me on: 01932 865500.

Unique to the intermediary market, The Family Springboard Mortgage is a 95% LTV 3-year fixed rate designed to help even more customers buy a home by providing access to affordable mortgages with just a five per cent deposit.

Here’s an example of how it works:

• Buyer wants to buy a house for £100,000
• Buyer must have £5000 deposit (5%)
• Parent (or Helpers) put £10,000 (10%) into a Helpful Starter Account (HSA). This will be locked down, so they will not be able to add or withdraw from the account
• The buyer can now get a 95% mortgage – with a competitive interest rate. 
• After three years, as long as the mortgage payments are kept up to date the parents [or Helpers] will get their £10,000 back with interest

We are very excited about the potential for this product and have enclosed the guide to the Family Sprinboard Mortgage, ahead of the full launch Monday

·  Your Guide to The Family Springboard Mortgage

For more information on this or any other financial related matters, please call us on 01932 865500 or email us at enquiries@jmlassociates.co.uk

Please click here to open our current JML Winter newsletter.

In this winter newsletter we look at a number of pension, investment and life issues.

Changes are afoot within the financial services industry, with a raft of new initiatives being introduced from 31 December 2012, which are designed to help restore and maintain trust and thereby protect your needs.

We look at workplace pensions and how auto-enrolment is coming to a firm like yours!

Surviving a critical illness – could you cope if you suffered and survived a critical illness, suh as a heart attack, cancer or stroke, and were then, understandably unable to return swiftly to work?

We also look at the EU directive coming into effect from 21st December 2012.

If you would like to talk to us about any issues in the Winter Newsletter please call us on 01932-865500 or email us at enquiries@jmlassociates.co.uk

NOW is the time to review your mortgage. Are you coming off your mortgage rate in the next 4 months? Are you sitting on a variable rate with your current mortgage lender wondering what to do?

Abbey for Intermediaries has launched today a 1.99% 2 year fixed rate mortgage. But this is only available for the next SEVEN days!!!!

It comes with a £1,495 arrangement fee which can be added to the mortgage loan, FREE valuation and a maximum loan size of £500,000 for buyers and remortgagors. The maximum loan to value is 60% of the property value or purchase price.

This mortgage deal will only be available until midnight on 29th November 2012, so  you will need to act quick.

Please call us as soon as possible on 01932 865500 for a mortgage review quotation as we expect this to be a very popular mortgage product.  

MACMILLAN COFFEE MORNING

On Thursday 27th September we hosted a coffee morning in aid of MacMillan. This is a special cause to my heart. 7 years I was diagnosed and treated for cancer and 3 years ago my daughter’s best friend was also diagnosed and treated for cancer. Both of us luckily fought this disease and we are fit and well now

The reason we held this on this date and not the official date of the 28th Setpember was beacuse this was a special date to a special lady. It was ‘Little Nanny’s’ 90th birthday.

Little Nanny is my Nan, she was diagnosed in the summer with terminal cancer and over the August bank Holiday we were told that she was not going to survive the weekend. Her wish though was to still be here for her 90th birthday. Luckily she rallied and on her 90th birthday she was moved into a nurshing home. She did make her birthday and so far she is still with us.

I would like to say a big THANK YOU to everyone who came and supported us. We ate lots of Krispy Kreme doughnuts and drank lots of coffee and tea. We raised a grand total of £330 on this day.

PRINCESS ALICE MIDNIGHT PJ WALK

On Saturday 8th September we took part in the midnight PJ walk for Princess Alice nurses.

Michelle, Jessica, Claudia and I walked 8 miles through the streets of Teddington, Twickenham, Richmond and Kingston dress in our pyjamas. We decided to dress up in our leopard onesies.

So far we have raised £720 towards this great cause. If you would like to make a donation please feel free to do this on our giving page http://www.justgiving.com/Michelle-Ford-LittleNanny

Trust the EU to put a price on women’s equality.

For a long time the cost of life cover has actually been going down. For years women got lower rates than men because statistically they live longer.

The EU gender directive is about to change all that.

From 21 December women can no longer be charged less than men just because they’re women. This means it could cost you up to 15%* more for your life cover if you wait till after 21st December to take it out.

 Source: *HM Treasury, December 2011

So if you are thinking about taking life cover, there really is no time like the present.

We’ll help you identify your individual protection needs and guide you through the various types of cover available to make sure you get the right cover at the right price.

Call us now to discuss your options on 01932 865500