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  • Tax

    BTL for children and IHT

    I would like to buy another buy to let property for around £250k 50%LTV.

    I am a young looking 45 (in my opinion!) but am already very concerned that the tax man is going to take a huge chunk of my portfolio one day before it gets to help my children.

    Is there a clever way of structuring a purchase now to avoid IHT later, but not screw things up for my children when hopefully they later buy places of their own ie  having to pay the extra 3% etc?  My children are 16,13,10 and 6.  I have read a little about discretionary trusts but can't quite get a handle on what they really are or how they work, eg I see that IHT is payable every 10 years anyway?

    Any ideas or things to google please?  Is there something obvious that the rest of the world is doing?  I will consider any off the wall ideas that might work.

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    Get professional advice and look into employee benefit trusts. Potentially no tax of any kind in the way and no 10 year charges

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    Yes there is a very easy way to invest 125 k for your children and avoid a lot of costs and pay zero tax

    Fund your pension if you can don't buy property

    its far easier

    you could set up 4 pensions in your name an nominate them as the beneficiary when you die

    The funds would then go to them and they then can draw an income after you have gone and they will only pay there rate of tax when they remove money from the pension

    No Stamp duty No Mortgage costs and no IHT and no leagle costs when you purchase

    totally controllable from your point of view

    God forbid one dies before you you just alter the benifiry form with zero charge

    If you really want property use your pension to buy commercial property

    If you have earnings be it self employment or employment it maybe could be done

    you may find this helpful

    https://www.youtube.com/watch?v=Wh8fdtSEzic

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    Learn Change and Adapt ?????