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Rules on Gifting Money

edited 30 November -1 at 1:00AM in Deaths, Funerals & Probate
10 replies 1.4K views
roadwearyroadweary Forumite
85 posts
edited 30 November -1 at 1:00AM in Deaths, Funerals & Probate

My father passed away last October and my mother is 84 years old.

She wants to give money to each of her grandchildren but is confused as to the rules about how much she is allowed to give.

She would like to give £2000 each to 5 grandchildren.

I have read around but am not entirely clear.

I *think* what the rules are saying is:

The total amount she can give away per tax year, tax free is £3000.

If she gave away £10,000 and died within 7 years, then at that point the £10,000 that was given away would be added to the value of the estate, and inheritance tax would be calculated on the entire estate.

In other words, there is no tax now, but only if she passes away, as part of the inheritance tax on her estate, and then dependent on when; within 3 years - fully taxable, 3-7 years - taper relief, over 7 years - no tax implications.

Is that correct?

She would prefer to give all the gifts in one go...and she's asked me to look into it for her.

Any advice gratefully received.



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