Gifting to reduce IHT - what evidence/audit is required?

silvercue

Hi,

The changes in the budget, in particular moving pension pot into IHT, mean I need to rethink my plans.

One thing I will look at is gifting to my son.   If I gift him money - there will be a record from the banks, which I assume is enough evidence of the gift and when it happened.   

I have crypto and could gift that to him by giving him control of the wallets.  There will be no audit trail.   Would writing a letter or email to my son confirming I have done this be enough to demonstrate the gift was made (hopefully) 7 years before I die?  Or do I need to do something more than this?

Thanks

Keep_pedalling

The only evidence HMRC will look for is evidence of undeclared gifts if they suspect your executor is not being truthful. If you son is your only child and they are also your executor they will know what needs to be declared as far as gifts to him but you should keep a record of you 7 years of gifting somewhere your executor can find it. If you are also considering gifts from excess income as well you need to keep records of expenditure as well.

Gifting crypto could leave you with a CGT liability if the gift contains gains in excess of £3000. 

silvercue

Keep_pedalling said:

The only evidence HMRC will look for is evidence of undeclared gifts if they suspect your executor is not being truthful. If you son is your only child and they are also your executor they will know what needs to be declared as far as gifts to him but you should keep a record of you 7 years of gifting somewhere your executor can find it. If you are also considering gifts from excess income as well you need to keep records of expenditure as well.

Gifting crypto could leave you with a CGT liability if the gift contains gains in excess of £3000. 

Thank you.  Makes sense.  The CGT liability is less than the IHT if I don't gift it.  

Keep_pedalling

silvercue said:t

Keep_pedalling said:

The only evidence HMRC will look for is evidence of undeclared gifts if they suspect your executor is not being truthful. If you son is your only child and they are also your executor they will know what needs to be declared as far as gifts to him but you should keep a record of you 7 years of gifting somewhere your executor can find it. If you are also considering gifts from excess income as well you need to keep records of expenditure as well.

Gifting crypto could leave you with a CGT liability if the gift contains gains in excess of £3000. 

Thank you.  Makes sense.  The CGT liability is less than the IHT if I don't gift it.  

Unless you die within 7 years in which case both will end up being paid.