According to new research many thousands of Brits are losing a great deal of inheritance money because they are adding life insurance policies to personal estates instead of writing them in trust.

Financial advisers Unbiased claim that the amount of Inheritance Tax that was paid unnecessarily in 2008 amounted to a staggering £1.9 billion. This was an increase of almost a quarter from the previous year.

They made clear that this trend was set to continue, despite the fall in house prices, many are still above the £312,000 cut-off point for Inheritance Tax.

“Inheritance Tax liability is paid by beneficiaries, often at a time when they are grieving over the loss of a loved one. Without advanced tax planning, increasing amounts of IHT will fall into the hands of the tax man. It is crucial that people see an independent financial adviser to discuss their tax liabilities remembering that it is legal to mitigate inheritance tax.” Said David Elms from Unbiased.