Inheritance tax, also known as estate tax or death tax, is a tax that is imposed on the transfer of an individual’s assets to their beneficiaries after their death. The tax is usually based on the value of the assets and can vary depending on the jurisdiction.

Inheritance tax planning refers to the strategies and techniques individuals can use to minimize the tax burden on their estate and maximize the amount of wealth they can pass on to their beneficiaries. It involves careful financial planning and taking advantage of available legal provisions.

There are several strategies that can be employed to minimize inheritance tax:

• 1. Gifting: Making gifts during your lifetime can help reduce the value of your estate subject to tax.
• 2. Trusts: Establishing trusts can allow you to transfer assets to your beneficiaries while minimizing tax liability.
• 3. Charitable donations: Donating to qualified charitable organizations can provide tax benefits and reduce your taxable estate.
• 4. Life insurance: Utilizing life insurance policies can provide funds to pay for estate taxes, ensuring that the burden does not fall on your beneficiaries.
• 5. Inheritance tax exemptions and reliefs: Understanding and utilizing available exemptions and reliefs can help reduce the overall tax liability.

Yes, inheritance tax planning is legal. In fact, it is a common practice for individuals to engage in tax planning to minimize their tax liability. It is important to consult with a qualified tax professional or estate planning attorney to ensure that you are following all applicable laws and regulations.

It is never too early to start inheritance tax planning. The earlier you start, the more time you have to implement effective strategies and take advantage of available tax-saving opportunities. However, it is also possible to engage in inheritance tax planning later in life, as long as you have sufficient time to make necessary arrangements.