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Understanding Inheritance Tax in the UK: How to Reduce Your Liability
Let’s look at the official example offered by the Government. Assuming that you own an estate worth of £500,000 and your tax-free threshold is the regular £325,000 (the example does not include the case mentioned earlier regarding children and grandchildren), the 40% tax mentioned earlier is applied on the £175,000 that result from subtracting £325,000 from the total of £500,000.
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