Sir Bruce Forsyth passed away in August 2017 at the age of 89. As with many whose wealth is considerable; he was rumoured to be worth around £17 million, Sir Bruce left a will detailing exactly where his estate should go upon his death using a clever and completely legal tax relief to ensure the total wealth was untouched by Inheritance Tax.
Usually, Inheritance Tax is paid on everything in an estate over £325,000 at a rate of 40% (subject to certain exceptions) but estates left to spouses and to charities are exempt from this tax.
In order to legally avoid paying inheritance tax on his estate when he passed away, Sir Bruce Forsyth left all of his estate to his wife, Wilnelia. It is thought that he will have left Wilnelia a Letter of Wishes which will have stated where Sir Bruce wanted his wealth distributed, possibly to include his children.
A Letter of Wishes is not a legally binding document but can be used to indicate to a spouse what you want to happen with your estate and that you trust them to respect your wishes upon your passing.
In order for Sir Bruce’s estate to completely avoid inheritance tax, Wilnelia must survive for seven years after the gifts are made to his children. If Wilnelia passes away before the seven years are up, any assets already gifted will be subject to Inheritance Tax, although tax may be payable at a reduced rate.
Inter-spouse Inheritance Tax exemption is one of the simpler tax reliefs and not just one that only the super-rich and famous can benefit from so it’s definitely worth considering using in your own will if you have an estate worth more than £325,000.
To discuss estate planning or to draft or amend your will, please get in touch with Farleys’ experienced private client team who can advise you on a range of topics relating to wills, trusts and probate. Call 0845 287 0939 or submit your enquiry online.