Gifting money & IHT rules if u pass away before 7 years

simon2018

Another question please.

Let's say my relative gave away 100k to his relative/etc.

Then he/she passes away on the third year.

His/her total assets inc their home was 225k.

Question: As it's within the 325k per person IHT threshold, would the 100k he/she gave away to one person still be taxed at their standard rate.

Many thanks again.:)

Linton

If the value on death of the estate plus any gifts made in the previous 7 years is less than the allowance, then there is no tax of any kind to pay. IHT isnt due and there are no taxes on gifts received.

simon2018

Many thanks Linton.

Therefore in plain English, when the gifter passes away and his/her estate is under the current IHT rates, eg 325k there will be no tax to pay?

Thanks

Tom99

simon2018 wrote: »

Many thanks Linton.

Therefore in plain English, when the gifter passes away and his/her estate is under the current IHT rates, eg 325k there will be no tax to pay?

Thanks

[FONT=Verdana, sans-serif]Not quite because if you die within 7 years the amount of gift is deducted from the available nil rate band so in your example £325k - £100k = £225k. So anything over £225k would be taxable.[/FONT]