Rules on gifts of up to £250

Sea_Shell

One could also buy gift cards* which just happen to slip into your supermarket trolley!   There are so many to choose from.

I don't think your historic statement debits would ever be scrutinized that closely as to what your £X weekly supermarket spend was made up of.

Who's to say it wasn't all groceries ...or wine!!


*For an outlet the recipient actually uses regularly 

Albermarle

We still pay for one of our young adult offspring to come on one holiday a year with us. Probably costs not far off £1500.
It never crossed my mind ( until now) that this should be included in the £3K exempt gifts total. Or should it?
I suppose if I gave them £1500 to go on their own holiday that would unequivocally be a gift, but to pay for a family holiday that includes them must be more of a grey area?

Brie

Don't forget that it's also ok to gift ££ for special occasions.  So you might give someone £250 every year for their birthday and then give them £500 when they graduate or get married or have a child.

The only people that might want to know about these things are if the local council is asked to pay for care.

[Deleted User]

Albermarle said:

We still pay for one of our young adult offspring to come on one holiday a year with us. Probably costs not far off £1500.
It never crossed my mind ( until now) that this should be included in the £3K exempt gifts total. Or should it?
I suppose if I gave them £1500 to go on their own holiday that would unequivocally be a gift, but to pay for a family holiday that includes them must be more of a grey area?

Sounds like a REGULAR gift out of income to me!

Jeremy535897

Brie said:

Don't forget that it's also ok to gift ££ for special occasions.  So you might give someone £250 every year for their birthday and then give them £500 when they graduate or get married or have a child.

The only people that might want to know about these things are if the local council is asked to pay for care.

The only occasion that qualifies for a special exemption is a gift in contemplation of marriage.to certain relatives.

Jeremy535897

purdyoaten2 said:

Albermarle said:

We still pay for one of our young adult offspring to come on one holiday a year with us. Probably costs not far off £1500.
It never crossed my mind ( until now) that this should be included in the £3K exempt gifts total. Or should it?
I suppose if I gave them £1500 to go on their own holiday that would unequivocally be a gift, but to pay for a family holiday that includes them must be more of a grey area?

Sounds like a REGULAR gift out of income to me!

It's a gift, certainly, and it may qualify for the normal expenditure out of income exemption. Most people do not think about these things. Technically, buying a friend a pint is a gift, although the £250 exemption is used to deal with this (the hope of reciprocation is probably not a valid argument). It would be very easy to get hung up on this stuff.

[Deleted User]

Jeremy535897 said:

[Deleted User] said:

Albermarle said:

We still pay for one of our young adult offspring to come on one holiday a year with us. Probably costs not far off £1500.
It never crossed my mind ( until now) that this should be included in the £3K exempt gifts total. Or should it?
I suppose if I gave them £1500 to go on their own holiday that would unequivocally be a gift, but to pay for a family holiday that includes them must be more of a grey area?

Sounds like a REGULAR gift out of income to me!

It's a gift, certainly, and it may qualify for the normal expenditure out of income exemption. Most people do not think about these things. Technically, buying a friend a pint is a gift, although the £250 exemption used to deal with this (the hope of reciprocation is probably not a valid argument). It would be very easy to get hung up on this stuff.

Last sentence - couldn’t agree more! 

loopauk

Thanks everyone for the replies - I was a little confused with the guidance.

So in summary, if my granddad's estate is less than £500k (married, and wants to gift to immediate family only), he could gift right now and there'd be no inheritance tax to pay?

Thanks.

Jeremy535897

Assuming that he qualifies for the full RNRB and ordinary nil rate band, his £500,000 estate cannot be subject to inheritance tax, even if he gives nothing away before death, and leaves everything to someone other than his spouse. But you are still asking the wrong question. If he was worth £10 million and gave £5 million away to someone other than his wife, there is no tax on the gift when made. If he dies within seven years of making the gift, then the gift would be subject to inheritance tax.

Albermarle

loopauk said:

Thanks everyone for the replies - I was a little confused with the guidance.

So in summary, if my granddad's estate is less than £500k (married, and wants to gift to immediate family only), he could gift right now and there'd be no inheritance tax to pay?

Thanks.

To emphasise the point in another way .

By gifting ( any amount) you can not be liable for more IHT when you die, than you would have been if you had not given the gift.
Gifting can not increase liability to IHT , it can only reduce it if you live 7 years after making the gift.