Inheritance Tax Article MoneySavingExpert.com Discussion

home_alone

I started by saying that if those that wish to pay IHT great but do not criticize those that do not. I have looked at various schemes that enable some saving on IHT but in my case I do not want to pay anything I think that the tax is unfair and is getting more unfair under this Goverment and more than likely the next goverment tory or otherwise. I stated what I intend to do and that is to bring myself below the level of whatever IHT limit there is when I die, you could call it my plan simple really the thought of giving at least £400K to browns kitty appalls me paying for Prescotts Texas holidays etc is not my cup of tea as Klondyke says this goverment is wasteful to the extreme. My last word on the subject.

gary

Tiggs_2

the problem with the plan above is that is highly unlikley to work (unless your liability is pretty small anyway)

assuming an esate of 500k + how can you "time" it so you are sub 300k at death? what if you die too soon? what if you get under 300k then live another 30 years?

without a crystal ball its not a great plan.

Tiggs_2

klondyke wrote:

I am more concerned than the kids about giving the government a chunk - because we have a totally irresponsble government at the moment!

lol...have to take your word for. Aside from wanting a gov to keep IHT in place so i can keep earning a living i have zero interest in anything else remotely political (unless they bomb me....i'd have issues with that!)

asdaprice

Can I please pose a new question - re joint accounts - if a joint account were to be set up between say an adult child and an elderly parent, I know the money in the joint account would have to be declared on IHT return if and when the parent died, but what about the parent's share of the money that has been spent in the account - would that have to be declared if the parent died within 7 years of depositing it?

klondyke

I'm not an accountant or anything, but I think you will find that as a joint account, money paid in by parent would not be regarded as a gift but remains his/her own money. hence 7 years doesn't enter into the equation.

Normally the amount in a joint account is deemed by IR to be 50/50 to each holder, unless you tell them otherwise eg if one of you consistently pays 75% of total in and the other 25% or summat.

On death of one holder, all money in it goes to the surviving holder, (which may be handy for paying probate etc) but the 50% or whatever other percentage has bee agreed as being paid by in by non-survivor needs to be accounted for IHT.

klondyke

home_alone wrote:

I wish you all the best Klondyke and hope you are out celebrating on Aug 14 and thereafter.

gary

Off topic really, but thanks - I ended up as an inpatient the next day having thrown up in the CT room and having severe nasties at both ends of me, needed rehydrating which took 4 days on a drip!!

However, the oncologist came to see me, realising I would not be having chemo. I told her about the scan in case there were any results, so she went to see and came back grinning like a Cheshire cat as I have apparently improved loads. So she was busy telling me that all the nasty side effects of chemo must be worth it. Hmmmm!

Yippee, might be able to go on a cruise soon if I can get travel insurance not costing more than the trip!!

santana-mx3

hiraethcottage wrote:

I wonder if someone could advise me with regard to the yearly amount of £3,000 that can be gifted to children free of IHT. My parents are both in the eighties and have substantial savings. My Dad believes that the £3,000 is the total amount that BOTH parents can gift. As my parents are taxed seperately surely this sum should be £6,000 in any one year. Can anyone clarify this? Many thanks.

Tiggs wrote:

your dad is wrong...its £3k per person (however...he's 80 so show some respect and pretend he's right )

To take this a step further, would a mother and father each be able to gift £3k to their daughter and another £3k to their son-in-law under this scheme (thereby doubling the amount again to 4 x £3k = £12k) or would that not count and just be seen as an obvious fiddle since daughter and son-in-law are married)?

Tiggs_2

IHT in this country has VERY little with inheriting anything...its all about the person who's estate is being lowered.

as such things like the £3k limit relate to the PERSON giving the money, no one cares who gets it...its a 3k limit, thats it.....give 3 x £1k, give 1x £3k, give 6 x £500k....etc -doesnt matter how you make up the £3k or who gets what.

santana-mx3

I knew that it was to do with the person whose estate is being lowered.

I think where I was going wrong is that, from what you say, the £3k limit is the total of all gifts from the person, not the total value of gifts from the person to each beneficiary.

Thanks for clearing that up.

Tiggs_2

santana-mx3 wrote:

I knew that it was to do with the person whose estate is being lowered.

I think where I was going wrong is that, from what you say, the £3k limit is the total of all gifts from the person, not the total value of gifts from the person to each beneficiary.

Thanks for clearing that up.

correct but who gets the gift is not relevant.