Tax Advisers for High Net Worth Individuals
Tax Advisers for High Net Worth Individuals
HMRC treats you as wealthy if your income is £200,000 or more, or your assets are worth £2 million or more, in any of the last three years. Around 850,000 people sit in that population, and HMRC runs a risk based model over all of them, complete with digital prompts that flag a self assessment entry which is out of line with what it expects to see. So the question is not whether you are being looked at. It is whether what HMRC sees will hold up. Does yours?
Merit is a firm of Chartered Accountants and Chartered Tax Advisers. Our high net worth tax planning UK work is led by a Chartered Tax Adviser who has worked inside HMRC. If you want a private client tax adviser who can tell you where the Inspector’s questions actually land, rather than one who finds out at the same time you do, that is what we do. In most cases, the tax we save our clients exceeds the fee they pay.
We are among the small number of tax advisers for high net worth individuals working from three UK offices: London WC1H, Stalybridge SK15 near Manchester, and Potters Bar EN6 in Hertfordshire. Fixed fees. Complete discretion.
Are you caught in the 60% tax trap?
The personal allowance is £12,570 in 2026/27. Once your adjusted net income passes £100,000 it is withdrawn by £1 for every £2 of income above that figure. It reaches nil at £125,140.
The personal allowance taper is the reason a £25,140 slice of your income is effectively taxed at around 60%. You pay 40% on the income itself, and you lose allowance that was previously tax free, which is taxed at 40% as well.
Gift Aid works the same way. A cash gift of £20,112 is worth £25,140 to the charity and reduces your adjusted net income by the same £25,140. It costs you £10,056 after tax relief.
How much inheritance tax will your estate actually pay?
The nil rate band is £325,000 and has been since 2009. The residence nil rate band is a further £175,000 where a home passes to children or grandchildren. Both are transferable between spouses and civil partners, and both are frozen through to the 2030/31 tax year. Anything you leave to a spouse or civil partner is exempt. The rate on death is 40%.
The trap is the residence nil rate band taper. It reduces by £1 for every £2 by which your estate exceeds £2 million, so it disappears entirely well before most of our clients’ estates are counted.
Real inheritance tax planning advice starts with knowing that number. Then we work on it: lifetime giving, ordering of assets between spouses, whether the £2 million line can be managed, and what your business assets qualify for.
What do the Business Relief changes mean if your wealth is in your company?
This is the live issue, and the reason to make contact now rather than next year.
From 6 April 2026 business relief inheritance tax and agricultural relief work differently. There is a combined allowance of £2.5 million per person on the value of assets qualifying for 100% relief. Above it, relief drops to 50%, which means an effective inheritance tax charge of 20% on the excess. The allowance is transferable between spouses and civil partners, even where the first death happened before 6 April 2026, so a couple can shelter up to £5 million of qualifying assets. The changes were enacted in Finance Act 2026.
Shares designated as not listed on a recognised stock exchange, which includes AIM, now attract 50% relief in all cases, and they sit outside the £2.5 million allowance rather than consuming it. Relevant property trusts have their own £2.5 million allowance for ten year anniversary and exit charges.
If your wealth is tied up in a trading company, our partners have built their own businesses from nothing to more than £1m turnover. We have sat where you sit.
What is a family investment company and when does it help?
A family investment company is an ordinary UK company that holds investments rather than trades. You fund it, usually by subscribing for shares or lending it money. Different classes of share give different family members different rights to income, capital and votes, so you can pass economic value down without handing over control.
When does it beat a trust? Usually when the amount involved is large. Putting more than the nil rate band into a discretionary trust triggers an immediate 20% lifetime charge, and the trust then faces charges of up to 6% every ten years plus exit charges. A company has no equivalent periodic charge.
The Corporation Tax position is the other attraction. Dividends the company receives from other companies are generally exempt from Corporation Tax. Other investment income, rent and gains are taxed at the 25% main rate, because a close investment holding company cannot use the 19% small profits rate or marginal relief. Compare that with 39.35% on dividends and 45% on other income inside a discretionary trust, or 45% plus the personal allowance taper in your own hands.
The catch is getting money out. A dividend to you is taxed again at up to 39.35%. A family investment company suits wealth you intend to retain and grow, not income you need to spend.
Do your trusts need a trust tax return?
If you are a trustee, almost certainly. Trustees of discretionary and accumulation trusts pay 45% on non dividend income and 39.35% on dividends, with only a £500 de minimis amount. The capital gains annual exempt amount for trusts is £1,500, half the £3,000 individuals get, and trustees pay 24%.
A trust tax return is a separate filing obligation from your own. We handle both, along with the ten year anniversary and exit charge calculations, so nothing falls between two advisers.
What should you do if HMRC writes to you about offshore income?
Do not ignore it, and do not reply before you have taken advice.
Over 100 jurisdictions now exchange financial account information automatically. When a nudge letter about offshore income arrives, HMRC usually already has the data. The letter is an invitation to correct the position on better terms than it will offer later.
The Worldwide Disclosure Facility is the route for anything with an offshore element: foreign accounts, overseas property, non UK trusts, foreign dividends. You notify HMRC, receive a disclosure reference number, then have 90 days to submit the disclosure.
The HMRC Let Property Campaign is the equivalent for undeclared UK or overseas rental profits. Again, notify first, then 90 days to disclose.
Why come forward before you are asked? Penalties are geared to behaviour and to the quality of your disclosure. The statutory maximum is 100% of the tax for a UK matter and 200% for an offshore one. An unprompted, complete and accurate disclosure attracts the largest available reductions. Waiting until HMRC has opened an enquiry removes that advantage, permanently.
Where HMRC suspects deliberate conduct it may offer the Contractual Disclosure Facility under Code of Practice 9. You have 60 calendar days to accept. Accepting and making a full disclosure is the only way to guarantee HMRC will not criminally investigate the behaviour you disclose with a view to prosecuting you. This is not correspondence to handle alone.
An offshore income disclosure handled properly is quiet, finite and priced. Handled badly it is none of those things.
Property, gains and ownership structures
Capital gains tax for individuals is 18% within the basic rate band and 24% above it. The annual exempt amount is £3,000. On a disposal of UK residential property you must report and pay within 60 days of completion, separately from your tax return, and late filing brings penalties and interest.
Two forward looking points. From 6 April 2027 property and savings income rates rise by two percentage points, to 22, 42 and 47%. And dividend rates already rose in April 2026, to 10.75 and 35.75% for basic and higher rate taxpayers.
Ownership structure is where the money is. Whose name, which entity, joint or several, company or personal. Getting that right at the point of acquisition is worth far more than any amount of tidying up afterwards.
What if you are newly UK resident, or leaving?
Domicile stopped driving your tax position on 6 April 2025. A residence based regime replaced it.
If you arrive after ten consecutive tax years of non UK residence, the four year foreign income and gains regime can exempt your foreign income and gains for your first four years of UK residence. If you used the remittance basis before, the Temporary Repatriation Facility lets you bring older foreign income and gains onshore at 12% in 2025/26 and 2026/27, rising to 15% in 2027/28, its final year. That window is closing.
For inheritance tax you become a long term resident once you have been UK resident for at least ten of the previous twenty tax years, at which point your worldwide assets come into scope, with a tail of three to ten years after you leave.
Overseas landlord and non resident company matters, including ATED, sit with our non UK residents and companies team.
Why private clients choose Merit
- Chartered Accountants and Chartered Tax Advisers, so your accounts and your tax position are reviewed by the same tax trained eyes.
- Direct HMRC experience on the team. We know how wealthy individuals are selected for review, and how to present a position that survives it.
- Partners who have built businesses from nothing to over £1m turnover, so advice on your company is commercial, not theoretical.
- Fixed fees agreed in advance. No hourly surprises.
- Over 130 five star Google reviews. Three offices. One point of contact.
- Discretion as standard. Sensitive matters are handled by the partner, not passed down.
We do not promote, market or implement tax avoidance schemes. Everything we recommend is a position we would be content to explain to an Inspector, because in some cases we will be.
We are not authorised by the Financial Conduct Authority and we do not give investment advice or recommend investment products. Where a matter needs a regulated financial adviser or a solicitor, we say so and work with yours.
Private client tax questions we are asked most
At what point does HMRC treat me as a wealthy individual?
HMRC’s Wealthy team covers individuals with income of £200,000 or more, or assets of £2 million or more, in any of the last three years. Those with the greatest complexity are assigned a Customer Compliance Manager who reviews returns alongside intelligence gathered inside and outside the UK. Crossing that line does not mean you have done anything wrong. It does mean your return receives closer attention.
Can I get out of the 60% tax trap if my income is mostly dividends?
The personal allowance taper applies to adjusted net income from any source, so dividends count. The arithmetic differs because dividends are taxed at 35.75% rather than 40% in 2026/27, so the effective marginal rate is not the same 60%. If you control the company you also control the timing, which is often the more valuable lever. We model it for your actual figures.
Does domicile still matter?
Not as the main test. From 6 April 2025 domicile was replaced by a residence based regime. Your exposure to UK tax on foreign income and gains now depends on your residence history, and your inheritance tax exposure depends on whether you are a long term resident, meaning UK resident for at least ten of the previous twenty tax years. Older structures set up around domicile often need reviewing.
Will my pension really be subject to inheritance tax?
For deaths on or after 6 April 2027, unused pension funds and most pension death benefits form part of the estate for inheritance tax, with personal representatives responsible for reporting and paying. Death in service benefits from a registered scheme and certain dependants’ scheme pensions are excluded, and the spouse, civil partner and charity exemptions still apply. Plans built on leaving the pension untouched should be reviewed before then.
Is a family investment company better than a trust?
It depends on the amount and on what you want from the structure. Trusts give greater flexibility and stronger asset protection, but a transfer above the nil rate band triggers a 20% lifetime charge and periodic charges of up to 6%. A company avoids those charges but taxes money coming out twice. Larger sums intended for retention usually favour a company. We compare both in pounds.
What happens if I ignore a nudge letter about offshore income?
HMRC generally sends these because it already holds data from one of the 100 plus jurisdictions that exchange financial account information. Ignoring the letter removes any credit for an unprompted disclosure, which is the single largest factor in reducing a penalty. Offshore penalties can reach 200% of the tax. Coming forward through the Worldwide Disclosure Facility before an enquiry opens keeps the outcome far cheaper and much quieter.
Do you prepare trust tax returns as well as personal returns?
Yes. We prepare personal tax returns and trust tax returns, and handle the inheritance tax side of trusts, including ten year anniversary and exit charge calculations. Keeping both with one firm matters, because trustee decisions and beneficiary positions interact. Splitting them between two advisers is how planning points get missed and how filing deadlines slip.
How do your fees work, and is the first meeting really free?
The first meeting is free and carries no obligation. After it, we quote a fixed fee for the work, agreed before anything starts, so you know the cost in advance. For planning work we will tell you honestly whether the likely saving justifies the fee. In most cases, the tax we save our clients exceeds the fee they pay. If it will not, we will say so.
What to do next
Three things, in order.
- Get your inheritance tax number calculated. Not estimated. Most people are surprised, and the residence nil rate band taper is usually why.
- If anything is undeclared, offshore or rental, come to us before HMRC comes to you. The difference is measured in tens of thousands of pounds and in whether the matter stays civil.
- If your wealth sits in a trading company or in AIM holdings, review it against the April 2026 relief rules and the April 2027 pension change now, while both are still planning decisions.
Bring your last tax return, a rough list of assets and any HMRC correspondence. We will tell you where you stand in the first meeting, at no cost. If you are with another firm, changing accountants is straightforward and we handle it.
Last reviewed: August 2026.
