Taking Stock Creative methods ensure wealth is kept in the family.
Creative methods ensure wealth is kept in the family.
Senior tax partner at Grant Thornton, Mike Warburton, has this week been giving tips for avoiding tax. One way wealthy, elderly spinsters can avoid death duty is to marry a boy/girlfriend of their children!
This method, aired on Radio 4’s Today Programme early this week, works because gifts swapped between man and wife are tax-free. Once they have been exchanged, the couple divorce and return to their previous situation – with the gift soundly passed on!
Warburton, said: ‘This is actually technically sound, although it is not something I would recommend, and none of my clients over the past 20 years have yet carried out this procedure!’
Another drastic tax tip from Warburton was for married couples with large pensions. He suggested that if they divorced, the couple could split the pension in half, in the process lowering their tax status, saving as much as #7,000 per year.
He added: ‘Of course it would be ridiculous to recommend divorce just to save on tax bills.’