paying somebody a monthly sum
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CABINET
Posts: 8 Forumite
in Cutting tax
This is probably not the right section but I was not quite sure where to put my question.
I would like to make a monthly payment out of my taxed income to my niece for the three years that she is attending university to help with general living expenses. Does anybody know if she will have to pay tax on this amount? The sum I have in mind is about £200 per month.
I would like to make a monthly payment out of my taxed income to my niece for the three years that she is attending university to help with general living expenses. Does anybody know if she will have to pay tax on this amount? The sum I have in mind is about £200 per month.
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Comments
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Not if you die. If you die within 7 years it maybe part of your estate where IHT maybe due.0
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If you pay this money out of your 'normal' income (and not savings) then IHT is not applicable and there is no tax due, either from you or your niece.
If you are paying out of savings and making no other gifts then you are allowed 3000 per annum without IHT considerations so 200 per month would be OK.
If your total estate is below the IHT allowance then it doesn't matter anyway.
If your estate is above the IHT limit and you don't give anything away then your estate pays IHT anyway so you might just as well give your money away now if it pleases you.0 -
Thanks very much for the replies - the money will come out of "normal" income.0
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