Equity release is a mortgage program for those over the age of 55. This type of mortgage allows you to live in the home and receive an income from the equity in the home. The income that one will receive from this type of program will be a great way to increase your monthly income over the amount that you are getting from a pension or the money that you saved for retirement.

The tax related benefits in a plan like this is well worth looking at. This alone can be a very good selling point for a plan like this. Not only will you enjoy the tax breaks, but your heirs will get some too.

Let’s start here. The number one tax benefit included in this type of scheme is that you receive the money that comes from the loan at a tax free rate. This is to say if you take the money in a single payment, no matter what the amount is that you get, it is tax free.

If you take out a mortgage like this and you are receiving a steady monthly income in lieu of the single payment option, the monthly income is also tax free. No matter how you look at it, any income that one can get at a tax free rate, is an excellent income.

The taxation status on the benefits allows you to receive them and not affect your pension in any way. If you are receiving payments for any type of means tested benefit such as council tax benefit, pension credit or pension saving credit it is worth checking with a qualified equity release adviser to see if the money you take will impact upon any of them. Generally if the amount you take when combined with any other savings falls below 10,000, there is no affect at all.

Your heirs will also receive a nice tax break when it comes to the inheritance tax that they have to pay. This is yet another of the great tax breaks that you and your family can receive from an Equity Release Lifetime Mortgage. It is always good to pay less inheritance tax and so any amount that has been borrowed plus any rolled up interest will not be subject to IHT, and is likely to reduce any potential IHT that could arise if your estate is valued greater than the current allowances.

Most estates will be made up primarily of property. When it comes to inheritance tax, you know that the tax man always likes his payment. When the inheritance is made up of more property than cash, there could be a strain on the heirs to come up with the money for the tax.

Equity Release Schemes can be a major benefit for those who are aged 55 or over, who own their own home, and who are asset rich but lack sufficient disposable income in retirement. With pros and cons to all financial products it makes sense to seek the assistance of a suitably qualified adviser.

For extra info about lifetime mortgages Click a link to get a free Equity Release Guide