Inheritance tax and regular payments.

I give my children regular monthly monies from my regular income and can do this without it affecting my standard of living.
I also pay for them to have a holiday every summer. Does the monies paid for this regular holiday count as a regular gift for inheritance purposes as again it does not affect my standard of living.

Comments

  • I give my children regular monthly monies from my regular income and can do this without it affecting my standard of living.
    I also pay for them to have a holiday every summer. Does the monies paid for this regular holiday count as a regular gift for inheritance purposes as again it does not affect my standard of living.
    It should do - that is exactly the way to go about it! 

    Can you do this comfortably?
  • JGB1955
    JGB1955 Posts: 3,428
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    Does the money come from regular income or savings?
    #2 Saving for Christmas 2024 - £1 a day challenge. £131 of £366
  • Keep_pedalling
    Keep_pedalling Posts: 16,098
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    You can’t claim an exemption on the fact that it does not affect your standard of living. We make regular gifts to our children which does not effect our standard of living but that is only because we have significant savings which we are now drawing down from, so we cannot claim the exemption.

    What is important is that your income exceeds your expenditure. If this is the case then as well as keeping records of your gifting you need to keep good records of your expenditure. Have a look at IHT form 403 parts 20 to 22 to see what your executor would need to fill in, and keep records to make their life easy.
  • [Deleted User]
    [Deleted User] Posts: 0
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    edited 5 January at 6:17PM
    JGB1955 said:
    Does the money come from regular income or savings?
    The op states ‘from my regular income’.
  • eskbanker
    eskbanker Posts: 29,737
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    edited 22 January at 2:51PM
    JGB1955 said:
    Does the money come from regular income or savings?
    The op states ‘from my regular income’.
    OP said that there are two different strands - monthly gifting 'from regular income' but also (separately) an annual holiday, and their question related to whether the latter would qualify, and the frequency of the holiday payments wasn't mentioned as far as I can see.  It also isn't clear to me whether OP pays directly for the holiday or gifts the money for the kids to do it, but I'm not sure if that's a significant difference....
  • [Deleted User]
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    edited 22 January at 2:51PM
    eskbanker said:
    JGB1955 said:
    Does the money come from regular income or savings?
    The op states ‘from my regular income’.
    OP said that there are two different strands - monthly gifting 'from regular income' but also (separately) an annual holiday, and their question related to whether the latter would qualify, and the frequency of the holiday payments wasn't mentioned as far as I can see.  It also isn't clear to me whether OP pays directly for the holiday or gifts the money for the kids to do it, but I'm not sure if that's a significant difference....
    Fair enough. I sought some clarification in my original post to encourage further details but the op has been silent since.
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