Gifting when estate value is below threshold for IHT

onthemend

Hi

could I ask for someone to confirm the following please.

Our elderly mother wants to gift money to her children. Her total estate value is below the IHT threshold. She is in good health and doesn't need any care home needs

she wishes to gift £10k to all 3 children.

Am I correct in thinking, if she was to sadly pass after making the gifts the children, even within the 7 years of gifting, there would not be any IHT to pay. or have I got this wrong?

thanks for any replies in advance

Famau

You are correct.  Unless her estate then rose for some reason to be around the threshhold where that 10k would take her above, then there would be no IHT liability.  But keep an eye on the budget just in case !

Albermarle

If her estate will be below the IHT threshold ( even with the £30K added back if she dies within 7 years) then there will be no IHT to pay. In fact she could give away any amount she liked and it would not be an issue with IHT.

However if she did need care and did not pay for it all herself and needed local authority money, then they would take an interest in anything that reduced her ability to pay, such as previous gifts. It is called deprivation of assets and the rules are quite complicated.