I wonder if someone can answer the following questions?
I have taken out a life insurance policy which pays out £x when I die or if I were to get a critical illness.
Is this lump sum tax free if I were paid this whilst I am alive (ie I have a critical illness)?
And what about upon my death?
What tax would be on levied on it?
And would it form part of my estate for inheritance tax?
I hear that you can set up a trust so that if you are likely to be above the IHT threshold, you can separate the pay out from your assets.
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Legal matters
Inheritance tax and life insurance
6 replies
CEvert · 24/04/2013 11:30
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