IHT403

patsy28

 

my husband has started to give a way some money to are daughter from earnings so no inheratance tax  we have savings held for some years we what to spend some of this on a new kitchen how do we with draw savings and not include it in expenditure

NorthYorkie

Why are you concerned about Inheritance Tax? What amounts are involved here?

probate_slave

Personally I would include the new kitchen as expenditure, in which case surplus income will be reduced, and the normal expenditure exemption possibly not claimable in that year. However it can be resumed in the following year.

Keep_pedalling

Is your husband documenting all his expenditure as well as his gifts? Claiming gifts from excess income is very difficult for an executor if the testator has not kept such records. Are you also making use of your annual exemptions?

I think I would class a new kitchen as capital expenditure but it is a bit of a grey area. If your joint net worth is over £1M then gifts from excess income is not going to lower your IHT liability very much, so both of you might consider making larger one off gifts.