Genovo has been designed to cover inheritance tax planning advice and includes a number of solutions and planning techniques that an adviser will typically recommend to mitigate a client’s inheritance tax liability. So how do you write an inheritance tax planning suitability report using Genovo?
1. Spell out the client’s objective(s)
“Look at ways to reduce the inheritance tax liability that could become due on your estate on your death” is included as a standard advice option within the Client Objectives step of the Introduction section. However, as with any standard objective you select within Genovo, you should still personalise its wording and add comprehensive Know Your Client information to it regarding what exactly the client is hoping to achieve.
Selecting the “Look at ways to reduce the inheritance tax liability that could become due on your estate on your death” advice reason will also trigger the inclusion of the Inheritance Tax Technical Notes within the appendix of the report. As will any of the IHT-related standard Genovo advice options in the Review of Client's Objectives step in the Review Report 2.0.
2. Overview of Client's Assets & Liabilities and IHT Position
Selecting the “Look at ways to reduce the inheritance tax liability that could become due on your estate on your death” advice reason will also trigger the Assets & Liabilities and IHT Position step in the Introduction section. Here you can include a summary of the client's assets and liabilities, and summarise their current IHT position.
You can edit the three column headings within the table e.g. change "Mr" to "Ed", and all of the columns and rows are intelligent, so if you do not enter data in a particular row or column it wont be included in your report.
The total net value of the client's estate will be auto-calculated and inserted in your report, and you will be prompted to insert the IHT liability that is currently due on the client's estate.
In terms of the report output, the table and surrounding text will be inserted within the Introduction section of the report under the client's needs and objectives.
3. Confirm any existing provision
You should use the Existing Provision step of the Introduction section to briefly outline any existing arrangements the client already has in place to meet the anticipated IHT liability.
Remember only those sub headings where text has been entered will be included within the report.
4. Trust Recommendations
You will be prompted to confirm whether the investment(s) you are recommending are to be written in trust within the Trusts step of the New Investment Recommendation section, and a range of IHT-efficient trusts (e.g. Discounted Gift Trust, Gift & Loan Trust etc) are included for your convenience.
On selecting a trust you will be prompted to provide further details relating to that particular type of trust e.g the immediate discount, or the IHT saving after 7 years etc, as well as information regarding the key individuals involved in the trust. This information will then be summarised in your report.
The key benefits and features of the type of trust you've selected will be automatically included in your report, and you will be prompted to confirm any disadvantages associated with the trust you have recommended in the Disadvantages & Tax Implications step of the New Investment Recommendation section.
5. Business Property Relief IHT Scheme Investments
Within the New Investment Recommendation section you can also recommend BPR IHT Schemes or BPR IHT Scheme ISAs, we've also included Octopus, Ingenious, Time Investments and Close Brothers as standard Genovo- managed providers within the Provider Library.
6. Life Insurance
Within the New Protection Recommendation section, you can recommend a Gift Inter Vivos or Level Term Assurance policy to cover the potential IHT liability that could become due on a gift, or a Whole of Life plan to mop-up the IHT bill due on death. You can also recommend that the plans are held under a variety of different protection-related trusts.
7. Supporting Information
Finally, you should use the Supporting Information step within the Important Information section to signpost the reader to any other related documents / information that you have provided. For example, this could be a general guide to Inheritance Tax planning, your original IHT discussion document, or your calculations showing the inheritance tax position pre and post recommendations.