Estate planning for clients who want to retain access and control

Our Business Relief estate planning scenarios are based on situations advisers often encounter, making them a great starting point for discussions with your own clients.

From April 2026, the first £2.5 million invested in unquoted (privately owned) shares that qualify for Business Relief will attract a 100% rate of relief (an effective IHT rate of 0%). Anything above £2.5m will attract a 50% rate of relief (an effective rate of 20% IHT). For shares to qualify for Business Relief, they must have been owned by the deceased for at least two years before they died. This makes Business Relief particularly relevant for clients keen to reduce future IHT exposure while keeping control of their wealth in the meantime.

Meet Jessica

In this client planning example, Jessica (aged 75) inherited her husband’s entire estate on his death and now has an estate worth £1.5 million, including a main residence worth £500,000 and a stocks and shares portfolio worth £200,000. She has a good level of income from her pension, but is still concerned about paying for any future care costs. Her financial adviser has explained she will have her own nil-rate band (NRB) of £325,000 and her husband’s NRB, which was unused on his death.

Jessica intends to leave her main residence to her children in her will, so her estate will be eligible for the residence nil-rate band (RNRB) of £175,000, as well as the RNRB of her late husband. As a result, her estate will benefit from combined IHT allowances of £1m. The remaining £500,000 of Jessica’s estate will be subject to IHT at 40%, meaning that as things stand, her estate has an IHT liability of £200,000 upon her death. She doesn’t want to make gifts to her children as one is currently separated.

Using Business Relief for IHT exemption

Jessica intends to leave her main residence to her children in her will, so her estate will be eligible for the residence nil-rate band (RNRB) of £175,000, as well as the RNRB of her late husband. As a result, her estate will benefit from combined IHT allowances of £1m. The remaining £500,000 of Jessica’s estate will be subject to IHT at 40%, meaning that as things stand, her estate has an IHT liability of £200,000 upon her death. She doesn’t want to make gifts to her children as one is currently separated.

Investor’s capital is at risk. Target returns are not guaranteed. This client planning scenario does not take into account investment growth or charges for the investment. It is based on tax rules and personal allowances at January 2026, which could be subject to change and depend on individual circumstances. Tax reliefs depend on the investments maintaining their qualifying status for Business Relief. This scenario is for illustrative purposes only and should not be construed as investment or tax advice.