Is gifting money now, liable for inheritance tax?

Thecreative

We have read the government guidelines however would welcome some clarification.

We have an elderly relative who is looking to gift some money now rather than later in a will, 
she owns her own house with approx value 160,000 however half was tied into her late husbands
will with him leaving it to the children on her passing. Taking she now has say 80,000 in the house 
and a savings pot of 20,000 can she gift the 20,000 ? As her estate won't be anywhere near the 325,000
inheritance level does that mean that it wont get taxed now or later?

Appreciate she can gift 3,000 per year tax free plus 250.00 per year to anyone she knows as presents etc..
but how would the 20,000 be viewed? If it would be taxable now, then at what rate?

Also, would gifting the money affect her position regarding any care she may need assistance with in the
distant future?

Thanks in advance for any advice.

km1500

yes if the estate remains under the iht threshold (currently 325k) no iht will be payable on the 20k gift 

DullGreyGuy

Gifts aren't taxed

If she dies within 7 years of making the gift then its considered as part of the value of her estate but as you believe that it will be within the nil rate band then that isnt a concern.

It is more likely to cause issues with any care arrangements as it can be treated as intentionally depriving yourself of assets 

eskbanker

Thecreative said:

Also, would gifting the money affect her position regarding any care she may need assistance with in the distant future?

If she was to be means-tested when applying for care funding, it's likely that that gifted £20K would still be regarded as hers, although it may depend on how distant that was....

Thecreative

Thanks everyone, all very helpful as usual.