The number of over-45s seeking estate planning advice has risen sharply in the past year as many struggle to understand inheritance tax (IHT) rules, research has shown.
Canada Life’s 2019 IHT Monitor, conducted in December 2018, showed four in five (80 per cent) over-45s believe current IHT rules are too complicated, up from 77 per cent in the previous year.
More than two fifths (42 per cent) have sought professional estate planning advice as a result, increasing from 32 per cent in 2018.
However, about a third of over-45s admit they would take estate planning advice from their solicitor rather than a financial adviser, while a fifth would seek advice from family and friends.
The survey gathered responses from 1,002 UK consumers aged 45 or over with total assets exceeding the standard nil rate IHT band of £325,000.
Neil Jones, Senior Technical Manager at Canada Life, commented: “It is no surprise that the current inheritance tax rules are too complicated. The Chancellor’s review into the inheritance tax system is welcome, but his calls for simplification are long overdue.
“Despite the persistent confusion, it is encouraging to see a significant number of over-45s seeking financial advice, up from last year.
“While seeing your solicitor or asking friends and family for help with estate planning might be easier, the only way to properly cut through the red tape is to tap into the years of experience and expertise of a financial adviser.”
When it comes to planning their estate, three in ten (28 per cent) are using their pension, 24 per cent are using Isas and a fifth are using a trust in their will.
Latest HMRC figures showed the number of family trusts declined from 200,000 in the 2003/04 tax year to 156,000 in the 2016/17 tax year after changes were made to way they are taxed.