Tax Liability - Gift to Parents

hpc_2

I can find plenty of information on tax when gifting money to children but I can't find anything going the other way. I have around £10,000 which I don't really need and which my elderly parents could put to better use as they are fit and healthy but not flush with cash. Is there any liability or limit where by I or they would have to pay tax on the gift?

stratty

You can make a gift of £3000 per year but if you gifted nothing in the prior year then this year you can gift £6000.

silvercar

Not sure of your ages, but it may be best to document it as an interest free loan repayable on death to prevent it becoming part of their estate. Shame to have to pay 40% inheritance tax to get it back!

As I say I don't know their ages, if you are 20 and they are 40, then this clearly doesn't apply.

CLAPTON

There is no gift tax in the UK so you can give your parents anything you like without being taxed.

However any such gift may potentially be liable to Inheritance tax if you die within seven years leaving an estate that is over the IH tax allowance at that time.... I would assume you're not too worried about this?

hpc_2

Thanks for the replies - very fast!

Just a bit more information which may help.

I'm 40 and they are in their 70's. Their total estate is worth considerably less than the inheritance tax limit. Not really interested in seeing the cash again so a loan is not really necessary. I'm also an only child and will be inheriting, (or the local cats home )