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Inheritance Tax can be a major issue. Without careful planning you, or your beneficiaries, could eventually be exposed to a tax liability.

The value of estates above the threshold of £650,000 for couples in the tax year 2010/ 11 is taxed at 40%. People who have been widowed will also benefit by being able to use any unused portion of their deceased partner's allowance when they die. So if all the estate were left to a surviving spouse, for which there is no IHT payable, that surviving partner will have the whole £650,000 allowance. For single people, the allowance is £325,000.

Owing to the sustained rise in house prices over recent decades, many more people’s estates are now large enough to be liable to Inheritance tax, although the latest increases in the nil rate band will go some way to alleviating the problem. The £650,000/ £325,000 threshold was fixed in the April 2010 budget until at least 2014/15. The annual gift exemption, £3,000, has not been increased for many years so the potential to give assets away continues to reduce in real terms.

After all the taxation in your lifetime, on both income and capital gains, the Inland Revenue demands the final say with Inheritance tax.

But does it have to? The "Death Tax" has often been described as the "voluntary tax". If you give enough away during your lifetime, and you survive long enough to avoid any tax claw-back, then you could still have the last laugh - leaving no more than an amount equal to the Nil Rate Band (this is the tax free amount of your estate the government allows you to pass on before your beneficiaries have to pay tax).