Gift from parent

After some advice. My mother in law wishes to gift my wife around £15,000 does anyone need to pay income tax or any other tax at all? I understand that inheritance tax may apply within 7 yrs if she passes away but her total estate value including this gift would be below the £325,000 inheritance tax limit.

thanks in advance
«1

Comments

  • marcia_
    marcia_ Posts: 1,500
    First Anniversary First Post Photogenic Name Dropper
    Forumite
     You don't pay tax on gifts 
  • but is t there a limit to the amount you can give away as a gift per tax year? £3000/year or £6000 in one tax year if nothing given in the previous tax year but this can only be done once
  • If she gifts £15k and lives for a further 7 years then no tax will be payable.
    Things that are differerent: draw & drawer, brought & bought, loose & lose, dose & does, payed & paid


  • Savvy_Sue
    Savvy_Sue Posts: 45,816
    Name Dropper First Post First Anniversary
    Forumite
    Is she leaving herself with plenty of money to deal with the unexpected - roof blows off, car dies, boiler and all white goods die at the same time? And is there any likelihood of her needing personal care - poor health, progressive disease or disability? 

    If yes and no, there's no issue at all. 
    Signature removed for peace of mind
  • silvercar
    silvercar Posts: 46,757
    Academoney Grad Name Dropper Photogenic First Anniversary
    Ambassador
    but is t there a limit to the amount you can give away as a gift per tax year? £3000/year or £6000 in one tax year if nothing given in the previous tax year but this can only be done once
    No limit on what someone can give away. The £3000/ year is a tax exemption from IHT should the donor die within 7 years, it doesn’t stop the money being given away.
    I'm a Forum Ambassador on The Coronavirus Boards as well as the housing, mortgages and student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to [email protected] (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.
  • Very interested in this thread. My elderly father wants to gift myself and brother some money. Inheritance tax wouldn't be an issue but the worry is him needing care in the future. In fact that's the reason he wants to gift us something now, so it doesn't line the pockets of a care home owner down the line.
    Save 12k in 2022 #33 0/20k
  • marcia_
    marcia_ Posts: 1,500
    First Anniversary First Post Photogenic Name Dropper
    Forumite
    Very interested in this thread. My elderly father wants to gift myself and brother some money. Inheritance tax wouldn't be an issue but the worry is him needing care in the future. In fact that's the reason he wants to gift us something now, so it doesn't line the pockets of a care home owner down the line.
     Which means he will be reliant on the cheapest possible service organised by social services. 
     Do you really want him to not have the best care so you can have your gift? 
  • Brie
    Brie Posts: 9,294
    Photogenic First Post Name Dropper First Anniversary
    Forumite
    Very interested in this thread. My elderly father wants to gift myself and brother some money. Inheritance tax wouldn't be an issue but the worry is him needing care in the future. In fact that's the reason he wants to gift us something now, so it doesn't line the pockets of a care home owner down the line.
    If he's dependent on the local authority to pay for his care they will be asking if he's given away any large sums and will want that reclaimed to cover costs.  Potentially if he owns his home the LA will put a lien on it so that when it's sold they get their money that way - but only if they see the gift as deprivation of assets.
    "Never retract, never explain, never apologise; get things done and let them howl.”
  • marcia_ said:
    Very interested in this thread. My elderly father wants to gift myself and brother some money. Inheritance tax wouldn't be an issue but the worry is him needing care in the future. In fact that's the reason he wants to gift us something now, so it doesn't line the pockets of a care home owner down the line.
     Which means he will be reliant on the cheapest possible service organised by social services. 
     Do you really want him to not have the best care so you can have your gift? 
    Honestly it's something we've discussed recently and yes that's how he feels, as do I and my brother. We (that's all of us) don't like the idea of him working hard all his life for everything he's worked for to go to care home boss and let's be honest that's where it goes as the staff don't see a great deal.
    Save 12k in 2022 #33 0/20k
  • marcia_
    marcia_ Posts: 1,500
    First Anniversary First Post Photogenic Name Dropper
    Forumite
    edited 29 May 2023 at 4:54PM
    marcia_ said:
    Very interested in this thread. My elderly father wants to gift myself and brother some money. Inheritance tax wouldn't be an issue but the worry is him needing care in the future. In fact that's the reason he wants to gift us something now, so it doesn't line the pockets of a care home owner down the line.
     Which means he will be reliant on the cheapest possible service organised by social services. 
     Do you really want him to not have the best care so you can have your gift? 
    Honestly it's something we've discussed recently and yes that's how he feels, as do I and my brother. We (that's all of us) don't like the idea of him working hard all his life for everything he's worked for to go to care home boss and let's be honest that's where it goes as the staff don't see a great deal.
     No the staff don't get paid there worth but the standard of care is very different between LA sourced and private care. Even down to food, entertainment, availability of a RN, therapies etc 

     But you should be more concerned about depravation of assets and council claims to his home 
Meet your Ambassadors

Categories

  • All Categories
  • 341.8K Banking & Borrowing
  • 249.7K Reduce Debt & Boost Income
  • 449.2K Spending & Discounts
  • 233.9K Work, Benefits & Business
  • 606.1K Mortgages, Homes & Bills
  • 172.5K Life & Family
  • 246.8K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.8K Discuss & Feedback
  • 15.1K Coronavirus Support Boards