George Houston: Are clients really interested in IHT?

George Houston looks at the emotive issue of IHT and says, while it is never straightforward, a discussion with clients is an essential part of the advice process

Are clients really that interested in IHT?

That was a question posed to me during a recent press meeting.

Fifteen minutes later, we came to the “I guess it depends on each client” conclusion.

But it did get me thinking about a number of clients I have seen in recent times and their differing attitudes to this tax which, even with a great deal of planning being done across the UK, has managed to consistently deliver more revenues to the Exchequer in recent years.

There are clients who really do care about the potential impact of IHT, many having worked hard to accumulate wealth over the years. At the opposite end of the scale, there are those who really don’t mind and are happy for their beneficiaries to pick up the tab and be content with whatever is left.

Neither strategy is wrong. It’s a factual thing – either you do something to mitigate/eliminate its effects or you don’t. And there’s probably a middle ground too – doing what you can and what is practical for you.

Talking it through

I often find that outlining the options that are open to a client, and the consequences of each, can help form a plan that meets their objectives but this also signposts options that might be adopted in future years.

A client who has gathered significant wealth relatively early may not wish to commit too much, if anything at all, to gifting or trust planning, given that they may wish to have access to this for themselves in the short to medium term.

But a discussion now will often have this on their radar for the future when it might suit best. For this type of client, effecting a life assurance policy in trust may turn out to be a preferred solution given their younger age and potentially better health, making the solution more cost-effective than in later years.

I also find more clients looking for comfort around “bloodline” planning, with concerns around cascading wealth to the next generation at the forefront of their minds.

With divorce rates increasing steadily, there is a worry that any assets passed on as part of a gifting strategy might be open to claim in the future – perhaps it’s a sign of the times but it is a genuine worry nonetheless.


The discussion of IHT is often an emotive one, and with good reason. There are a number of things to consider as well as the emotional aspects and I find this is the perfect opportunity to ensure that clients’ legal, tax and financial planning advisers work hand in hand to ensure the best outcome for clients – it is never straightforward, but as long as all parties focus on the clients’ objectives, that comfort can be achieved.

I was also asked: “Can IHT be avoided completely?” Well, I guess it depends on each client.

George Houston is technical director at Mattioli Woods