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Tax

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If my parents gift me the maximum exemption amount per annum (£3,000 plus £3k for previous year if unused), to reduce the IHT value of their estate, does this affect my own tax liability in the tax year that I received the gift?

Comments

  • lordbase
    lordbase Posts: 26 Forumite
    Cash gifts will not be subject to any tax on the recipient (ie you). Just be aware that they (your parents) may have CGT issues if they are giving you non-cash assets (ie giving you £3,000 worth of shares per year).

    There is also another opportunity if they want to give in excess of the £3,000 each which is to give regular gifts out of their income - as long as it doesn't affect their living standards.

    So if they have income sources which they don't need they can gift you this income on a regular basis to reduce their estate free of IHT.

    Although I would suggest that you take professional advice to ensure that this is set up properly.
  • CLAPTON
    CLAPTON Posts: 41,865 Forumite
    10,000 Posts Combo Breaker
    each of your parents can give 3k per annum out of capital for IHT purposes, so jointly they can give you 12k this year (3k each plus 3k carried over from last year)

    and there are no tax implications for yourself when you receive the gift
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