Inheritance tax is an area many people forget about when planning their finances.

This is the view of Carl Lamb, managing director of Almary Green Investments, who added some individuals falsely believe it can be expensive to look into inheritance tax planning

Speaking to Money Marketing, he explained it is actually cost-effective and painless.

Mr Lamb said: "Inheritance tax planning is a simple way to ensure clients' estates on death are passed to their loved ones and not the taxman."

He added one of the problems involved in financial planning is convincing people of the importance of keeping their Wills up to date when their circumstances change.

According to Paul Johnson, director of the Institute for Fiscal Studies, raising inheritance tax could be a good way to balance the books for the coalition government if it wants to drop the 50p income tax rate in the next Budget, the Daily Telegraph reported.

Current laws state 40 per cent of assets are payable to the government if the amount is over £325,000 in total.