A surge in demand for inheritance tax advice is being predicted by financial advisers.
Recent research from Prudential also indicates that interest in forming partnerships with lawyers may grow, mainly to help deal with demand.
The findings indicated that a growth in demand for IHT advice, over the next year, is expected by over two-thirds of advisers (69%). 37% predict that this increase will be significant.
However, regulatory changes have impacted the confidence levels of some advisers, in relation to providing IHT advice. 17% of advisers state that because of this, they want to form links with legal firms as well as other specialists. Whilst over a third (35%) state they are thinking about developing links with lawyers, 22% of advisers say they are in the process of working with legal firms already.
The recent IHT rule changes are the main driver in demand according to almost 60% of advisers. Having been implemented during April 2017, the changes introduce a residence nil-rate band; an additional tax-free allowance of £100,000. Where a main residence is being bequeathed to a direct descendant, the tax-free threshold is set to grow by an extra £175,000 in 2020/21. For a couple, this will be a combined IHT allowance of £1 million.
Commenting on the research was Paul Harrison. The Head of Business Consultancy at Prudential highlighted how the changes in IHT has impacted the demand for advice.
“Rising property and pension wealth are making it increasingly important for advisers to be able to help clients with specialist advice on IHT planning and demand for advice is booming.
“However, providing that advice is becoming more complex with changes to pension rules as well as IHT limits, and advisers are absolutely correct to work with other specialists to ensure that clients are receiving the best possible support.”
