Inheritance tax question

RFBurns

Hi all,I'm about to be given £10,000,my share of my late fathers life policy premium,by my mother,and wondered if there are any procedures to go through ie do I have to declare this to HMRC?do I become liable for any payments to HMRC? I am married with two children working full time,my wife is a full time mum and we receive working tax credits.Thanks!!

Keep_pedalling

There will have been no IHT to pay on this as even if the policy was not written in trust as assets inherited by a spouse are exempt. We don’t have gift tax in the UK so you have no need to declare the gift to HMRC.

As the amount is over her annual £3000 exemption most of it will remain in her estate for IHT purposes for the following 7 years, so she should keep a record of all such gifts to help her executor when she dies.

The only thing that might be problematical is that this would be seen as deliberate deprivation of assets if she is receiving any means tested benefits.