We'd like to remind Forumites to please avoid political debate on the Forum... Read More »
We're aware that some users are experiencing technical issues which the team are working to resolve. See the Community Noticeboard for more info. Thank you for your patience.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
Inheritance tax on Gift
Options

baggins_22
Posts: 26 Forumite

Hi my Dad passed away last year and we went through the probate process which has completed now.
He had a small amount of money in his account and his estate was below IHT
The money he did have in his account was gifted from my grandad (his father) (still alive) 5 years ago.
His father has recently had some health issues and a friend of the family has advised that if he is to pass away within the next 5 years I would need to pay tax on the money my grandad gave to my dad.
I wonder if someone could advise on the validity of this and also what the terminology is called so I can look into this
Thanks
He had a small amount of money in his account and his estate was below IHT
The money he did have in his account was gifted from my grandad (his father) (still alive) 5 years ago.
His father has recently had some health issues and a friend of the family has advised that if he is to pass away within the next 5 years I would need to pay tax on the money my grandad gave to my dad.
I wonder if someone could advise on the validity of this and also what the terminology is called so I can look into this
Thanks
0
Comments
-
Have a look at the "How Inheritance Tax on a gift is paid" section of this GOV.UK page https://www.gov.uk/inheritance-tax/gifts1
-
As long as the gift was below £325,000, you can ignore 2hat has been said. The gift may still form part of grandfather’s estate if he dies within 7 years of making it, but any IHT that might be due comes out of his estate not from you.1
-
Keep_pedalling said:As long as the gift was below £325,000, you can ignore 2hat has been said. The gift may still form part of grandfather’s estate if he dies within 7 years of making it, but any IHT that might be due comes out of his estate not from you.0
-
It's not really like that. Grandpa's estate pays IHT before anyone gets the money. So, it is possible everyone who gets everything gets a bit less.
But it has no effect on your father's estate. Just if any of his family inherit from grandpa, it may be a bit less.
But grandpa may have a £1m-gifts IHT allowance anyway.If you've have not made a mistake, you've made nothing1 -
As above. IHT is paid by the estate, not by the recipients.No free lunch, and no free laptop1
-
One thing to note from the government docs (https://www.gov.uk/inheritance-tax/gifts) - " Once you’ve given away more than £325,000, anyone who gets a gift from you in those 7 years will have to pay Inheritance Tax on their gift."
When my grandad sold his house he had some accommodation created at one of my family's home to be closer to support. I have no idea how this was arranged, he might have just given them the money for the building work. I also don't know the timeline on if that happened before he gifted my late father his money. Also not clear if this then passes on to us given the money wasn't actually gifted to us and the person that it was gifted is no longer with us (if that makes any sense)0 -
baggins_22 said:One thing to note from the government docs (https://www.gov.uk/inheritance-tax/gifts) - " Once you’ve given away more than £325,000, anyone who gets a gift from you in those 7 years will have to pay Inheritance Tax on their gift."
When my grandad sold his house he had some accommodation created at one of my family's home to be closer to support. I have no idea how this was arranged, he might have just given them the money for the building work. I also don't know the timeline on if that happened before he gifted my late father his money. Also not clear if this then passes on to us given the money wasn't actually gifted to us and the person that it was gifted is no longer with us (if that makes any sense)3
Confirm your email address to Create Threads and Reply

Categories
- All Categories
- 350.8K Banking & Borrowing
- 253K Reduce Debt & Boost Income
- 453.4K Spending & Discounts
- 243.7K Work, Benefits & Business
- 598.5K Mortgages, Homes & Bills
- 176.8K Life & Family
- 257K Travel & Transport
- 1.5M Hobbies & Leisure
- 16.1K Discuss & Feedback
- 37.6K Read-Only Boards