Wedding Gift

Notfarfromtheborder

Hi

I understand we can gift £5K each to son's wedding, plus £3K annual gift allowance (as well as £3K from last tax year if not used)

How close to the wedding does the £5K need to be for it to be classed as a wedding gift, wedding is in June 26?

Funds will be used to pay for the wedding, which will need paying before the big day.

Thanks

sheramber

https://www.gov.uk/hmrc-internal-manuals/inheritance-tax-manual/ihtm14191

Under IHTA84/S22 a gift will be exempt up to the limits set out below if it was made

• on or shortly before a marriage or the registration of civil partnership (IHTM11032) takes place,

Albermarle

You can gift as much as you like to anybody, there are no limits.

The only issue is that IF your estate is likely to be liable for inheritance tax ( most are not) and IF you die within 7 years of making the gift, then gifts will be counted back into your estate ( so you will not lose out, just be back at square one) .

If both points are relevant then and only then does the £5K and £3K become relevant.

I just make this point as lots of posters do not seem understand that if they are unlikely to be liable for IHT then these allowances are irrelevant.

Notfarfromtheborder

Albermarle said:

You can gift as much as you like to anybody, there are no limits.

The only issue is that IF your estate is likely to be liable for inheritance tax ( most are not) and IF you die within 7 years of making the gift, then gifts will be counted back into your estate ( so you will not lose out, just be back at square one) .

If both points are relevant then and only then does the £5K and £3K become relevant.

I just make this point as lots of posters do not seem understand that if they are unlikely to be liable for IHT then these allowances are irrelevant.

Thanks, yes, liable for IHT, or at least will be when pensions are rolled in to calculations

Notfarfromtheborder

sheramber said:

https://www.gov.uk/hmrc-internal-manuals/inheritance-tax-manual/ihtm14191

Under IHTA84/S22 a gift will be exempt up to the limits set out below if it was made

• on or shortly before a marriage or the registration of civil partnership (IHTM11032) takes place,

Thanks, maybe 6 months is too soon then

mybestattempt

Notfarfromtheborder said:

sheramber said:

https://www.gov.uk/hmrc-internal-manuals/inheritance-tax-manual/ihtm14191

Under IHTA84/S22 a gift will be exempt up to the limits set out below if it was made

• on or shortly before a marriage or the registration of civil partnership (IHTM11032) takes place,

Thanks, maybe 6 months is too soon then

The legislation simply refers to gifts made in contemplation of marriage, no specific time ahead of the marriage is specified and the  guidance doesn't specify what is "shortly before".

It may be prudent to make the gift as close to the wedding as is practicable.

However, I feel the exemption could be justified provided a clear link between the gift and the wedding could be verified by way of documents, bank statements, receipts etc (and perhaps a note explaining the timing of the gift if some months before the wedding).

Ultimately, it will be for the executor of your estate to decide whether to claim the exemption if they feel they could defend a challenge from HMRC on the issue.

Keep_pedalling

Notfarfromtheborder said:

sheramber said:

https://www.gov.uk/hmrc-internal-manuals/inheritance-tax-manual/ihtm14191

Under IHTA84/S22 a gift will be exempt up to the limits set out below if it was made

• on or shortly before a marriage or the registration of civil partnership (IHTM11032) takes place,

Thanks, maybe 6 months is too soon then

I think we gave both our children the 5k wedding exemptions about 6 months before their weddings. Mainly because they were organising everything  so had quite a few expenses that far in advance.

silvercar

We paid some wedding contractors (for our child’s wedding) direct. The invitations to the wedding followed the traditional format of ‘Mr/ Mrs silvercar together with mr/mrs Z invite you to celebrate the marriage of our children X & Y’ . We don’t consider this gifts to our child as we were paying for the wedding party that we hosted.