Inheritance Tax

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  • getmore4less
    getmore4less Posts: 46,882 Forumite
    Name Dropper First Anniversary First Post I've helped Parliament
    You are currently ok and you have in effect 7 years for the 50k to drop out of the estate.

    If you have not used the £3k allowances you could do £12k now and another £6k in april leaving £32k PET from April.

    Or just loan her the £32k and gift £6k each of the following years.

    more IHT efficient if you don't need/plan to gift more in the 7 year period.

    A diy DOV is fairly easy to get right but unless you both die and your estate grows a lot redundant.
  • Tom99
    Tom99 Posts: 5,371 Forumite
    First Post First Anniversary
    [FONT=Verdana, sans-serif]As Getmore4less says, if you decide not to go the Deed of Variation route then give your wife £25k now (completely tax fee), then you and your wife gift your daughter £25k each, say £20k each now and £5k each after April 6th.

    [/FONT] [FONT=Verdana, sans-serif]If you and your wife have not used last years £3k allowance, then when added to this years £3k you have £6k each for the gifts now and another £3k for the April gift

    [/FONT] [FONT=Verdana, sans-serif]That mean the potentially exempt transfer will only be £16k for each of you and if either of you die within 7 years that £16k will be reduce your nil rate band by £16k
    .    [/FONT]
    [FONT=Verdana, sans-serif]Document these gifts and the fact your 3x£3k each is unused and leave a copy with your wills.[/FONT]
  • IronDuke
    IronDuke Posts: 14 Forumite
    edited 5 February 2018 at 4:18PM
    Hi,

    Thanks to everyone who responded to my query.

    I had never heard of a Deed of Variation so the responses were very helpful as
    although at this time I don't seem to be liable to IHT the future is unknown so I've decided to take out a Variation anyway to put things on a legal footing.

    As my Deed is very straightforward and simple a local solicitor has quoted £125 + vat and for that cost it's probably well worth doing.

    Thanks again.
  • Sea_Shell
    Sea_Shell Posts: 9,344 Forumite
    First Anniversary Photogenic Name Dropper First Post
    Is it just the one Daughter you have?
    How's it going, AKA, Nutwatch? - 12 month spends to date = 2.31% of current retirement "pot" (as at end March 2024)
  • IronDuke
    IronDuke Posts: 14 Forumite
    Yes and two grandchildren.
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