Gift to grandchildren
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Kirkmain
Posts: 177 Forumite
If I pay for my grand-daughters riding lessons, which will amount to 50k per year, this will exceed my 3k annual allowance, who has to declare it on their tax return? My daughter? Surely not my grand-daughter, she's 12!
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nobody ... yet
the 50 K only comes in to play if you die within the next 7 years and exceed the IFT threshold0 -
Flugelhorn said:nobody ... yet
the 50 K only comes in to play if you die within the next 7 years and exceed the IFT threshold
So my children need to be tracking everything I spend on them and my grandchildren including holidays, gifts, piano lessons, riding lessons, swimming lesson, all those time I paid for the visit to Santas grotto, all those times i paid for Sunday lunch etc.. etc..on a 7 year rolling basis?
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Kirkmain said:Flugelhorn said:nobody ... yet
the 50 K only comes in to play if you die within the next 7 years and exceed the IFT threshold
So my children need to be tracking everything I spend on them and my grandchildren including holidays, gifts, piano lessons, riding lessons, swimming lesson, all those time I paid for the visit to Santas grotto, all those times i paid for Sunday lunch etc.. etc..on a 7 year rolling basis?
However I think it is fair to say that some of the items you mention are at best a grey area, when it comes to what is deemed a gift for IHT calculation purposes, although I guess overall they could add up to quite a bit.
Is your estate likely to be big enough to attract an IHT liability ?0 -
I’m not an expert, but I don’t think most of these things (except the gifts) would count as gifts - particularly if you pay for them directly rather than giving the money to your daughter. Even then, regular payments out of your income are ok - from this page: https://www.gov.uk/inheritance-tax/gifts#:~:text=Some%20gifts%20are%20exempt%20from,between%20spouses%20or%20civil%20partners.‘You can make regular payments to another person, for example to help with their living costs. There’s no limit to how much you can give tax free, as long as:
- you can afford the payments after meeting your usual living costs
- you pay from your regular monthly income
These are known as ‘normal expenditure out of income’. They can include:
- paying rent for your child
- paying into a savings account for a child under 18
- giving financial support to an elderly relative
If you’re giving gifts to the same person, you can combine ‘normal expenditure out of income’ with any other allowance, except for the small gift allowance.
For example, you can give your child a regular payment of £60 a month (a total of £720 a year) as well as using your annual exemption of £3,000 in the same tax year.’
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Albermarle said:Kirkmain said:Flugelhorn said:nobody ... yet
the 50 K only comes in to play if you die within the next 7 years and exceed the IFT threshold
So my children need to be tracking everything I spend on them and my grandchildren including holidays, gifts, piano lessons, riding lessons, swimming lesson, all those time I paid for the visit to Santas grotto, all those times i paid for Sunday lunch etc.. etc..on a 7 year rolling basis?
However I think it is fair to say that some of the items you mention are at best a grey area, when it comes to what is deemed a gift for IHT calculation purposes, although I guess overall they could add up to quite a bit.
Is your estate likely to be big enough to attract an IHT liability ?
Where do people keep these records? On my computer? Because after I've died how will anyone get hold of it? Should I keep a lodger in the top drawer for my family to find?
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Kirkmain said:Where do people keep these records? On my computer? Because after I've died how will anyone get hold of it? Should I keep a lodger in the top drawer for my family to find?
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Kirkmain said:Albermarle said:Kirkmain said:Flugelhorn said:nobody ... yet
the 50 K only comes in to play if you die within the next 7 years and exceed the IFT threshold
So my children need to be tracking everything I spend on them and my grandchildren including holidays, gifts, piano lessons, riding lessons, swimming lesson, all those time I paid for the visit to Santas grotto, all those times i paid for Sunday lunch etc.. etc..on a 7 year rolling basis?
However I think it is fair to say that some of the items you mention are at best a grey area, when it comes to what is deemed a gift for IHT calculation purposes, although I guess overall they could add up to quite a bit.
Is your estate likely to be big enough to attract an IHT liability ?
Where do people keep these records? On my computer? Because after I've died how will anyone get hold of it? Should I keep a lodger in the top drawer for my family to find?1 -
To be honest, if you're spending £50k a year (really? £1,000 a week?) on riding lessons I would expect to see said grandchild at HOYS.2021 Decluttering Awards: ⭐⭐🥇🥇🥇🥇🥇🥇 2022 Decluttering Awards: 🥇
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Floss said:To be honest, if you're spending £50k a year (really? £1,000 a week?) on riding lessons I would expect to see said grandchild at HOYS.
With that many hours of riding lessons each week, there can't be much time for school, eating or much else. At £50 per hour for individual lessons, that would be 20 hours a week. With that much riding time, one would also expect the individual to be putting in an equal amount to gym time for strength, balance, yoga and plyometrics. This is the path for an elite athlete.Kirkmain said:If I pay for my grand-daughters riding lessons, which will amount to 50k per year, this will exceed my 3k annual allowance, who has to declare it on their tax return? My daughter? Surely not my grand-daughter, she's 12!
The only possible tax will be IHT if you do not survive 7 years.0 -
If you pay the venue directly, who's to know they weren't your lessons 😉.How's it going, AKA, Nutwatch? - 12 month spends to date = 2.31% of current retirement "pot" (as at end March 2024)0
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