Joint account and inheritance tax?

It would become their's immediately. Not on your death. OK so long as you trust them.

bouicca21 wrote: »

Because I live in London my modest home is worth a tad more than the inheritance tax threshold, so any savings will be taxable. I have been wondering about putting some money into a joint account with my children. This would become theirs on my death - but would it go under the rules for gifts?

If you want to give it to them, give it to them. I think I am right in saying that not only does a joint account have all the problems people have listed in event of divorce or relationship breakdown (you with them, as well), but would be entirely ineffective as an IHT dodge because the gift would be deemed to have taken place at the point of your death and therefore fall completely within your estate anyway (because it's a "gift with reservations" as you can spend the money yourself at any point).

If you give them the money absolutely, and live seven years, then it falls outside IHT. And no imaginable case could be made for someone who retained assets taking them to the edge of IHT being guilty of deprivation of assets, particularly as you (presumably) are not on the threshold of requiring care. If minimising IHT is your intent, then you need to give away assets absolutely, more then seven years before death, and ideally with clear blue water between the gift and any suggestion that you might require funded care.

The bank will allow access for that reason anyway!