Tapered gifting

sorethumbs1992

400k Cash + House 350k (left to child) = 750k total

325k plus 175k RNRB = 500k threshold before IHT

 

So want to potentially gift 250k and get that total down to 500k

Tapered relief doesn’t kick in until you gift over 325k?

Or does it now mean it doesn’t kick in until over 500k? (because of the RNRB)

DRS1

Stupid question but if you have a child weren't/aren't you married?  Or had/have a civil partner?  I only ask because that could get you up to £1million if you die second and then you wouldn't need to worry about giving anything away.

Quite apart from the fact that giving £250k away on those figures looks a bit dramatic.  I wouldn't do it.

HappyHarry

sorethumbs1992 said:

400k Cash + House 350k (left to child) = 750k total

325k plus 175k RNRB = 500k threshold before IHT

 

So want to potentially gift 250k and get that total down to 500k

Tapered relief doesn’t kick in until you gift over 325k?

Or does it now mean it doesn’t kick in until over 500k? (because of the RNRB)

Gifts over £325,000 can benefit from taper relief. The RNRB does not come into that.

Keep_pedalling

As has already been said TR only applies to gifts over £325. To be absolutely clear it only applies to the part of the gift exceeding £325k, so if for example you gift £400k TR only applies to £75k.

Keep_pedalling

DRS1 said:

Stupid question but if you have a child weren't/aren't you married?  Or had/have a civil partner?  I only ask because that could get you up to £1million if you die second and then you wouldn't need to worry about giving anything away.

Quite apart from the fact that giving £250k away on those figures looks a bit dramatic.  I wouldn't do it.

Based on a previous thread the OP was not married to his partner at the time of her death. 

DRS1

Keep_pedalling said:

DRS1 said:

Stupid question but if you have a child weren't/aren't you married?  Or had/have a civil partner?  I only ask because that could get you up to £1million if you die second and then you wouldn't need to worry about giving anything away.

Quite apart from the fact that giving £250k away on those figures looks a bit dramatic.  I wouldn't do it.

Based on a previous thread the OP was not married to his partner at the time of her death. 

Ah.  Put my foot in it there.

I am going to have to work out how to see what people have posted in the past.

silvercar

DRS1 said:

Keep_pedalling said:a

DRS1 said:

Stupid question but if you have a child weren't/aren't you married?  Or had/have a civil partner?  I only ask because that could get you up to £1million if you die second and then you wouldn't need to worry about giving anything away.

Quite apart from the fact that giving £250k away on those figures looks a bit dramatic.  I wouldn't do it.

Based on a previous thread the OP was not married to his partner at the time of her death. 

Ah.  Put my foot in it there.

I am going to have to work out how to see what people have posted in the past.

Click on their name. The pop up shows the number of comments and the number of discussionss. Click on the discussions and you see a list of discussions they have started.

sorethumbs1992

DRS1 said:

Keep_pedalling said:

DRS1 said:

Stupid question but if you have a child weren't/aren't you married?  Or had/have a civil partner?  I only ask because that could get you up to £1million if you die second and then you wouldn't need to worry about giving anything away.

Quite apart from the fact that giving £250k away on those figures looks a bit dramatic.  I wouldn't do it.

Based on a previous thread the OP was not married to his partner at the time of her death. 

Ah.  Put my foot in it there.

I am going to have to work out how to see what people have posted in the past.

It's fine.
As it stands I'm 250k over the limit so expecting 100k bill when time comes
I might just try and dish a lot of that out on 7 years and hope for the best.  

I have thought about leaving a lump sum to someone in will but I might pay them lump sum now, get it down to the NRB/RNRB and then that person gets what I planned to give them ahead of time.  And hopefully after 7 years that leaves the NRB/RNRB chunk for the offspring. 

Keep_pedalling

sorethumbs1992 said:

DRS1 said:

Keep_pedalling said:

DRS1 said:

Stupid question but if you have a child weren't/aren't you married?  Or had/have a civil partner?  I only ask because that could get you up to £1million if you die second and then you wouldn't need to worry about giving anything away.

Quite apart from the fact that giving £250k away on those figures looks a bit dramatic.  I wouldn't do it.

Based on a previous thread the OP was not married to his partner at the time of her death. 

Ah.  Put my foot in it there.

I am going to have to work out how to see what people have posted in the past.

It's fine.
As it stands I'm 250k over the limit so expecting 100k bill when time comes
I might just try and dish a lot of that out on 7 years and hope for the best.  

I have thought about leaving a lump sum to someone in will but I might pay them lump sum now, get it down to the NRB/RNRB and then that person gets what I planned to give them ahead of time.  And hopefully after 7 years that leaves the NRB/RNRB chunk for the offspring. 

It might be worth looking at term life insurance to cover any IHT on gifts. This is something we did when we made substantial gifts to our children. Whether this is possible or affordable will depend on your age and state of health. We were in our early 60s when we did it and it was not very expensive. 

sorethumbs1992

That's a good suggestion. I wonder how you set it up.

Wouldn't any life insurance end up being added to the Estate total and as a result end up accruing its own slice of payable IHT?

poseidon1

https://forums.moneysavingexpert.com/discussion/comment/81856174#Comment_81856174

Term assurance set up for IHT planning purposes, is placed in trust from outset so as not to form part of your estate on death.

Pretty standard procedure, and the life companies usually supply the trust document for execution by the policy holder. You simply decide on trustees and the ultimate beneficiaries.