IHT Gift from surplus income - capital v income question

Howarewetoday

Hi. I had a long and interesting discussion about IHT with a relative over Christmas continues. My relative's apparently had a long discussion with their boss about the subject. I've been drawn into the debate. I've aired an aspect on here about gifting and taper relief and had some great comments. Many thanks for those.

Another element of the discussion centred on what is and isn't income, and what is and isn't regular living expenses, and what is regular. The context being giving regular gifts out of surplus income.

Points of contention re income include Premium Bond prizes (no), interest from ISAs that is credited to the ISAs (no), work travelling expenses (yes) and sale of car (no).  (my very amateur guesses are shown)

Points of contention re regular expenses include purchase of newer, better car (no), improvements to house that increases it's value (such as kitchen refurb etc) (no),. (my very amateur guesses are shown)

Points of discussion about regular include what is regular. Is it monthly (yes) Can it alter (yes). Does it need to reflect monthly income (no) or can it reflect annual income patterns (yes) (my very amateur guesses are shown)

all wisdom is very much welcomed thanks 

MarzipanCrumble

Isn't 'income' relatively clear?  Surely it is regular payments into a current account from which you pay bills etc??

mybestattempt

@MarzipanCrumble

I think, perhaps, your comments were meant to be posted another thread.

Jeremy535897

Look at https://www.gov.uk/hmrc-internal-manuals/inheritance-tax-manual/ihtm14231 and the links for the questions you have.