Cash gift fairness

getmore4less

Pollycat wrote: »

Hello, OP. :wave:

It would be good if you could pop back and confirm in which country you are resident.

The key is where the brothers are resident not the giver

Pollycat

getmore4less wrote: »

The key is where the brothers are resident not the giver

It was a plural 'you'.

gettingtheresometime

next week's moral dilemma ????

onomatopoeia99

Dakota_Deville wrote: »

Thee is tax to pay - see criteria from HMRC site - we don't know the amounts the op is talking about so tax to pay subject to criter

I've removed the section on inheritance tax as it's irrelevant to the question asked. If you had read the question, you would have seen that only one brother would have had to pay tax due to his income being higher. IHT does not vary dependent on the recipients income. If the giver dies the day after and the gifts are subject to IHT due to the value of the estate, then both recipients would have to pay the same amount as they received the same gifts.

You are bringing in something completely irrelevant into the discussion for the sake of being argumentative. The original question is phrased in a way that suggesta tax would be due from one brother on the receipt of the gift, which is not the case in the UK.

Mojisola

onomatopoeia99 wrote: »

If the giver dies the day after and the gifts are subject to IHT due to the value of the estate, then both recipients would have to pay the same amount as they received the same gifts.

It's the estate of the deceased which would pay any inheritance tax due, not the people who received the gifts.

If there was no money left in the estate, the recipients might then be pursued for the tax but that's an unusual situation.

da_rule

getmore4less wrote: »

That only applies if the gifts were over the nil rate band.

The gifts use up the nil rate band leaving less for the rest of the estate.

It is extremely rate that IHT on gifts falls back on the recipient.

Thanks for that, I thought I had put that as one of the provisos but apparently not.

Person_one

onomatopoeia99 wrote: »

You are bringing in something completely irrelevant into the discussion for the sake of being argumentative.

Well, he has started a Donald Trump appreciation thread in DT...

getmore4less

Mojisola wrote: »

It's the estate of the deceased which would pay any inheritance tax due, not the people who received the gifts.

If there was no money left in the estate, the recipients might then be pursued for the tax but that's an unusual situation.

It depends on the size of the gifts,

If they were given £200k each then there would be IHT on the gifts if there was only one IHT allowance, even if there were funds in the estate it is the recipients of the gift that pay it.

Dies day after.
tax due (£400k-£325k)*0.4 = £30k or £15k each.

edit:
Should also add that the gifts use up the nil rate band oldest first so if the gifts were given to one on the Monday and the second on the Tuesday and they died Wednesday ALL the tax is due on the Tuesday Gift.

da_rule

Dakota_Deville wrote: »

No it's not, it is you that is ignorant even after I posted hlp from the HMRC site and I quotr, "Exempted gifts
You can give away £3,000 worth of gifts each tax year (6 April to 5 April) without them being added to the value of your estate. This is known as your ‘annual exemption’.!

We did not know what the op was asking whether it ware lagre amounts even on that there is tax if they die 7 yrs and the tz free sum per person is 325 after death but not before.

OP was taling about 'gifts' and as mentioned above via hmrc I rest my case.

The key words are "added to the value of your estate". You can give away more than the allowance but the value will be added to your estate for the purposes of inheritance tax.

You are quoting from inheritance tax rules, which only apply (except for payment into discretionary trusts) when someone dies.

Gifts that are made in the last 7 years are chargeable, after this they are not (except for reservation of benefit etc).

Key thing to learn: Inheritance Tax - Only payable on death (except for very rare occasions).

Keep_pedalling

Dakota_Deville wrote: »

No it's not, it is you that is ignorant even after I posted hlp from the HMRC site and I quotr, "Exempted gifts
You can give away £3,000 worth of gifts each tax year (6 April to 5 April) without them being added to the value of your estate. This is known as your ‘annual exemption’.!

We did not know what the op was asking whether it ware lagre amounts even on that there is tax if they die 7 yrs and the tz free sum per person is 325 after death but not before.

OP was taling about 'gifts' and as mentioned above via hmrc I rest my case.

The OP was talking about tax paid by the recipient of gift, which as everyone except you has correctly pointed out that no such tax exists. Just because the word gift appears in your cut and paste does not make it relevent as the context is totally different.

Donald Trump may think you can have alternative facts, but in the real world there are no such things.