Gifting money TO parents, limits and tax

Rootamoota

My son is 18 and has recently received an inheritance from his grandmother.
He wants to give about £10k to his father (me) and I wanted to know the limits so that no tax will be paid, by myself? (I work and am a 40% taxpayer, he is a student)
As I understand it there is a tax free limit of £3k per person per year and this can double if the previous years allowance wasn’t used.
Is this still applicable within the family?
This will just be a one off payment.
Is the limit £6k or can he give me £10k without me paying tax?

TadleyBaggie

There is no tax on gifts.

McKneff

What he says....

Rootamoota

But am I right about the limits?
£6k is the maximum that he can give me or can he go to £10k and I still won’t pay?

uknick

He can give what he wants. The limits you mention only relate to inheritance tax, and this is only applicable if he dies within 7 years of the gifts and his estate at time of death attracts IHT, i.e. is over £325k.


You will pay no tax at all on whatever he gifts you.


I know the above is rather simplistic, but unless the inheritance is very significant, or his assets are already large, I'm not sure IHT will ever come into play.

Rootamoota

I understand about the IHT but as he is 18, he is more likely to outlive me, so not worried about that.
I’m concerned about breaking a gift allowance and therefore when I declare the £10k in self assessment it will be included as income for me and therefore I pay 40% tax.
I’ve probably missed something obvious but don’t want to break the rules and then lose a chunk of money to the taxman...
Thanks

[Deleted User]

You do NOT declare the GIFT. It is not income for tax purposes. That is all you have missed.

The gift allowance is relevant to your son, the donor, not you.

Rootamoota

So I don’t need to declare gaining £10k on my self assessment?
Ok, that would work for me. :-)
Would that be the same if a mate gave me £10k?

Gabbs_the_Newt

Yes. As per post 2, there is no tax on gifts.

[Deleted User]

Gabbs_the_Newt wrote: »

Yes. As per post 2, there is no tax on gifts.

As per post 2, 3, 5, 7 and now 9 :beer:

Keep_pedalling

It would not be a good idea for him to do this if your net worth is already in IHT territory. If that is the case the gifting ought to be the other way round.