Gifts out of regular Income

I've set up a regular payment to my daughter each month and have kept records etc to show it is coming from excess income. My question though,  is whether after 7 years (as is with a one off gift) these payments are no longer part of the estate? If this is the case, would the records become redundant to the tax man after 7 years, therefore?

Comments

  • Rodders53
    Rodders53 Posts: 2,083
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    https://www.gov.uk/inheritance-tax/gifts details it all.

    Gifts out of excess income are exempt.  Full stop.  No 7 years rule.

    However you'd be wise to keep records for the regular payments set up, any increases etc.,. for your Executors to prove what regular gifts, and when. 
    It won't harm to keep them for longer than 7 years in an electronic spreadsheet, or even an old fashioned paper leger. 

    Same as other exempt gifts made.

    The above all assumes your Estate will be paying IHT as, if the total including gifts made is well inside the nil rate band/nil rate residential allowances then it's a moot point.
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