David had recently sold his business and had cash and a property investment company as the proceeds of the sale. Alongside this he had built up pension, ISAs and other investments over the course his career, which alongside his house meant his estate was worth c.£3 million. David relied on the investments to provide some of the income that he needed to support his lifestyle, but he wanted to see how he could arrange his estate to maximise what was passed on to his 4 children.
Having reviewed his portfolio we then put together a Lifetime Cash Flow-Forecast, which helped to demonstrate how much of his assets he needed to rely on and how much he could afford to give away. The gifts were made to a Trust to provide ongoing generational protection and so he controls who benefitted from the cash and when.
We then introduced him to an accountant and worked together to restructure the shareholding of investment company, so that he could still draw on the income he required, but more of the capital value of the company was passed to his children.
Finally, we advised that a small part of his portfolio was invested into a higher risk portfolio, so that it was removed from the value of his estate after 2 years.
Having followed all these measures, David now has his full Residential Nil Rate Band back and has reduced the potential IHT liability from £600,000 to around £20,000 after 7 years.