To beat the UK taxman, you need to ensure that when you die, everything you own totals less than the nil tax band of £300,000.

It may be something that is distasteful to consider but because gifts between husband and wife are tax free, assets should be passed to the partner likely to live the longest.

As already stated, the transfer of assets into offshore or discretionary trusts could also be a useful tool although it should be noted that such transfers would be subject to an immediate IHT charge if they exceed the nil rate band (taking into account the previous seven years' chargeable gifts and transfers). Such trusts, then, need to be carefully structured. A smart adviser should be able to feed your assets into trusts in such a way as to avoid triggering an  IHT charge.

There are a range of different types of trust, some of which can be linked to school fee planning or Insurance. Whilst there are common types of offshore trusts, certain offshore jurisdictions have structured trust vehicles unique to their jurisdiction. Often they compete on how difficult it is for onshore taxmen to overrule them. Your adviser should be able to tell you what is available in the market and what is best suited to your particular circumstances.  But suffice it to say that the whole idea of a trust is to protect your assets and to distribute those assets in line with your wishes. In this sense it might be well worth considering in relation to IHT.

It may also be possible to use an Offshore company to protect assets. An Offshore trust would own the shares in the Offshore company.

The key thing for the taxman is to recognise your disassociation from the assets held in trust.

The UK’s pre-owned assets tax (POAT) was introduced in April, 2005 and is intended to deter people from attempting to get around the rules on ‘gifts with reservation.’

The POAT imposes income tax charges on the benefit people are deemed to have derived from assets they have given away but continue to have an interest in – living in a house, for example. In the case of property, the charge is on the estimated market rent, at the taxpayer’s highest rate.

As mentioned earlier, giving away money to family and friends is another option. You might consider gifting money to children on an annual basis - to help them get onto the property ladder, for example. If your children are undeserving, then there’s always charity. Charitable gifts are tax free as are gifts to museums and universities (and political parties).

Wedding gifts are another option and can be made tax free to children (£5,000), grandchildren (£2,500) and anyone else (£1,000). In a wedding year the £3,000 annual lump sum could be added to your child’s wedding gift to provide an asset disposal of £8,000.

Larger transfers of capital  - known as Potentially Exempt Transfers (PETs) - should be made as early in life as possible to avoid an IHT charge. They become free of a charge seven years after being made.

In practice this is a difficult thing to judge, given that few of us know how much we can afford to give away that far in advance and even fewer of us know seven years in advance when we are going to die!