Over half of UK adults still don’t have a will – and it’s costing the nation billions in Inheritance Tax

Over half of UK adults still don’t have a will – and it’s costing the nation billions in Inheritance Tax

That's according to recent figures from the Institute of Fiscal Studies, which predicts the amount of IHT paid by grieving families will more than double from £7bn in 2023 to £15bn by 2033 if the situation remains unchanged.

That’s because the number of homes that exceed the NRB is on the rise thanks to an increase in property values – and families whose homes fall into the 40% IHT tax bracket are failing to utilise the tax-efficient planning available to them through wills and trusts.

Figures from the Office for Budget Responsibility show the number of estates that breach the 40% tax charge is due to increase from 40,000 to almost 50,000 in the next three years. By 2028, when the NRB unfreezes, thousands more homeowners will leave their loved ones with unnecessary taxes upon death without the right planning in place.

Estate planning made easy

“Raising awareness among clients about how trusts work and the vital role they play in protecting their assets for future generations is essential,” says CTT Director Andrew Houston.

“Utilising trusts is the most effective way to reduce the amount of Inheritance Tax due on an estate. That’s why at CTT, we are committed to helping advisers remove this obstacle to understanding for their clients.”

“Through our digital Client Portal, advisers can educate their clients on the functionality of various trusts using animations that explain in simple terms the flexibility and tax savings trusts give them when planning for their future.”

The Client Portal not only smooths the way for clients, it also helps speed up the process for advisers, providing you with instant access to your client’s fact find and digital reporting.

“The Client Portal allows clients to complete their own fact find in their own time and submit it digitally to their adviser,” explains Andrew. “This information is then used by the adviser to generate a personalised Recommendation Report for the client, which explains all the various options available to them and makes it very easy for them to file an Order of Instruction.”

Knowledge and tools: help your clients and grow your business

Without a will in place, the risk of dying intestate increases, pushing more and more UK estates into the 40% tax bracket.

Tax efficient planning helps clients realise a maximum tax-free threshold of up to £500,000 on their estate when combining the NRB (£325,000) and the RNRB (£175,000) allowances.

CTT offers its advisers access to one-of-a-kind trusts that help your clients achieve these savings simply and efficiently. We also provide all the necessary adviser training and support to ensure you can apply these trusts with confidence to your clients’ estates, no matter your level of experience or how complex they are.

“Our position in the Estate Planning sector is unique and our approach is forward-looking.” states CTT Co-Founder and Director, Clive Ponder, TEP. “Not only do we have the in–house expertise required to develop our own trusts and software, we also help our advisers expand their knowledge and broaden their offering.”

“By incorporating CTT’s digital tools and training into their estate planning practices, our members reach a wider client base; they enjoy a more effective means of communicating with their clients, and they open the door to more opportunities for business growth.”

The takeaway

The percentage of UK adults that don’t have a will and the money it’s costing the families is a real wake-up call for the industry. It’s also testament to the fact that traditional approaches to providing Estate Planning services aren’t working.

CTT is driving to close the gap between advisers and their potential clients through increased knowledge, digital technology, and sustained growth. Our aim is to reposition the Estate Planning sector as an essential, accessible, customer-focussed service, and bring together talented providers with those in need of our expert help.

To find out more about how CTT can help you reach more clients and reduce their tax bill, get in touch.