My mother who was widowed a number of years ago has a home worth somewhere in the region of 450-500k. She also has investments of about 50k. Using these figures my calculations would be that the IHT liability on her estate is somewhere in the region of 100-120k.
I realise that if she were to sell her house and release some capital, pehaps buying a cheaper property, these funds could be given away and would fall under the PET rules. Some simple life assurance (in trust!) for 7 years could be used to pay for IHT on the sum given away to protect against her dieing during that 7 year period.
I have read a number of articles in the press and on the internet including ones on this web site that say that a house cannot be gifted where the person making the gift still has an interest/gets direct benefit from the gift i.e. in this case lives in the property.
Is there any other course of action that can be taken in these circumstances to reduce/remove the IHT liability? Would using an equity release scheme to get funds as a PET outside the estate be worthwhile? Are there any trusts that can help or is this just too complex and risky?
Any help would be much appreciated.
Thanks.
My question is
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