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Long story short my dad is selling our family home for 100k. He wants to know if he can give 20k to each of his four 3 children. He is married but seperated.

Ive read that he can only give 3k tax free so im assuming its not 3k each.

Hes always said if he was to sell the house he'd buy a conservatory for us.

Am I right in saying if he gave me 20k of the house sale and he was to die within 7 years then I would be subject to IHT. I find this outrageous as basically he can only give 3k away a year without being taxed. Am I reading this right?

Also what if he bought the conservatory for us from his house sale rathet than giving us the money to pay for it. Would that make a difference?

Thanks in advance
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  • edited 7 April at 11:28PM
    SilvertabbySilvertabby Forumite
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    edited 7 April at 11:28PM
    Where will he live once he has sold the house?  Is he likely to need to move to a care home anytime soon?
  • edited 7 April at 9:40PM
    naedangernaedanger Forumite
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    edited 7 April at 9:40PM
    Sidboi21 said:
    Long story short my dad is selling our family home for 100k. He wants to know if he can give 20k to each of his four 3 children. He is married but seperated.

    Ive read that he can only give 3k tax free so im assuming its not 3k each.

    Hes always said if he was to sell the house he'd buy a conservatory for us.

    Am I right in saying if he gave me 20k of the house sale and he was to die within 7 years then I would be subject to IHT. I find this outrageous as basically he can only give 3k away a year without being taxed. Am I reading this right?

    Also what if he bought the conservatory for us from his house sale rathet than giving us the money to pay for it. Would that make a difference?

    Thanks in advance
    He can gift the money but what happens is that if he dies within 7 years that money still counts as part of his estate. This does NOT mean that tax will automatically be paid on the gift. Tax will only be payable if the estate (including the gifts is over the IHT threshold) and the tax would be paid by the estate not you (except in certain extreme circumstances which won't apply to your father's estate based on the figures given).

    And it is not like his estate is paying more tax. It is just a means of preventing someone from avoiding IHT that would otherwise be payable on their death by gifting away their estate prior to death.

    The basic IHT threshold is £325,000 and can be much more - up to £1million, depending on circumstances. If you think he has more than £325,000 before giving gifts we can firm up on the IHT threshold specific to his circumstances by asking a few questions. 

    PS. If he wants his children to inherit then I hope he has a will given he is married but separated.
  • edited 7 April at 9:41PM
    StubodStubod Forumite
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    edited 7 April at 9:41PM
    ..there is no "gift tax", he can give anybody whatever he wants, the only implications to consider would be inheritance tax and deprivation of asset should they apply.

  • MarconMarcon Forumite
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    Sidboi21 said:


    Am I right in saying if he gave me 20k of the house sale and he was to die within 7 years then I would be subject to IHT. I find this outrageous as basically he can only give 3k away a year without being taxed. Am I reading this right?

    Also what if he bought the conservatory for us from his house sale rathet than giving us the money to pay for it. Would that make a difference?


    You do seem easy to outrage. What's outrageous about preventing people from evading IHT by giving away the bulk of their assets shortly before they die?

    Buying the conservatory for you rather than giving you cash wouldn't alter anything.
  • gettingtheresometimegettingtheresometime Forumite
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    naedanger said:
    Sidboi21 said:
    Long story short my dad is selling our family home for 100k. He wants to know if he can give 20k to each of his four 3 children. He is married but seperated.

    Ive read that he can only give 3k tax free so im assuming its not 3k each.

    Hes always said if he was to sell the house he'd buy a conservatory for us.

    Am I right in saying if he gave me 20k of the house sale and he was to die within 7 years then I would be subject to IHT. I find this outrageous as basically he can only give 3k away a year without being taxed. Am I reading this right?

    Also what if he bought the conservatory for us from his house sale rathet than giving us the money to pay for it. Would that make a difference?

    Thanks in advance
    He can gift the money but what happens is that if he dies within 7 years that money still counts as part of his estate. This does NOT mean that tax will automatically be paid on the gift. Tax will only be payable if the estate (including the gifts is over the IHT threshold) and the tax would be paid by the estate not you (except in certain extreme circumstances which won't apply to your father's estate based on the figures given).

    And it is not like his estate is paying more tax. It is just a means of preventing someone from avoiding IHT that would otherwise be payable on their death by gifting away their estate prior to death.

    The basic IHT threshold is £325,000 and can be much more - up to £1million, depending on circumstances. If you think he has more than £325,000 before giving gifts we can firm up on the IHT threshold specific to his circumstances by asking a few questions. 

    PS. If he wants his children to inherit then I hope he has a will given he is married but separated.
    He may want to run this idea past a solicitor as well - especially if there's a divorce in the offing
    Lloyds OD / Natwest OD / PO CC / Wescott / Argos Card / JD Williams cleared :) thanks to the 1 debt v 100 day challenge
  • Keep_pedallingKeep_pedalling Forumite
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    It does not sound like his estate is anywhere near IHT levels, but where is he going to live after selling up, and how much would this leave him in the form of savings? 

    Unless he has significant other assets this would be treated as deliberate deprivation of assets if at some point in the future he needs care.
  • mamanmaman Forumite
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    There really enough information to advise properly here.

    It really does depend on where/how he intends to live after he sells this house and gives away the majority of the proceeds. 
  • Sidboi21Sidboi21 Forumite
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    Okay sorry I should have mentioned.

    So the house is only worth 120k but he will probably get 100k for it.

    He is married but separated but they get on better now than they did. The speak every day and whatever has to be done with the house sale my mother agrees.

    I have managed to get him into social housing so thats where he will live for the forseable future.

    He has mo other assets and only recieves a small monthly pension <400 along with the state pension. He has no savings either. 
  • Sea_ShellSea_Shell Forumite
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    If they are still married and this was the family home, is your Mum not a joint owner?   Is she not entitled to anything from the sale?
    "It's time to start digging up those Squirrelled Nuts"!!!

    * I shall only get involved in new threads, once a dialogue has been established with the OP *
  • FlugelhornFlugelhorn Forumite
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    Sidboi21 said:
    Okay sorry I should have mentioned.

    So the house is only worth 120k but he will probably get 100k for it.

    He is married but separated but they get on better now than they did. The speak every day and whatever has to be done with the house sale my mother agrees.

    I have managed to get him into social housing so thats where he will live for the forseable future.

    He has mo other assets and only recieves a small monthly pension <400 along with the state pension. He has no savings either. 
    If he has no savings and limited income then maybe he needs to keep the money himself. If he applies for means tested benefits he won't get them if he has given money away and similarly if he needs any care it will look like he has deprived himself of assets. tell him to keep the money and live a more comfortable life 
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