Inheritance Tax
Options
newatc
Posts: 846 Forumite
We are in the fortunate position of regularly gifting money to our children who are our beneficiaries, mostly making use of annual exemptions but sometimes going over that for specific reasons (eg house buying).
I had thought that any tax would be paid, when the time comes, by our estate. But I read recently that HMRC could request the IHT from those receiving the gift which is not what we would want.
I can't believe it would be a problem whatever as it's all in the family but so that we know what to expect, can anyone clarify the process when our IHT form is sent in as part of the probate process?
I had thought that any tax would be paid, when the time comes, by our estate. But I read recently that HMRC could request the IHT from those receiving the gift which is not what we would want.
I can't believe it would be a problem whatever as it's all in the family but so that we know what to expect, can anyone clarify the process when our IHT form is sent in as part of the probate process?
0
Comments
-
-
Normally tax on gifts would be paid by the estate as part of the IHT due. However there could be extreme cases where someone has literally given away all their money leaving themselves destitute and their estate unable to pay the tax. HMRC may then chase the recipients though I believe they may choose not to.0
-
As others have said this only happens rarely in cases where people have given so much away that there is not enough left to pay any IHT that is due.
Are you aware that your combined nil rate bands mean that unless your joint net worth exceeds £1M IHT is not really something that you need to be concerned about?
If your estate is in IHT territory then you should consider taking out a term insurance policy that would cover any IHT gifts should both of you meet an unfortunate early demise.
To make things simple for your executors you should keep a record of all gifts with a copy of your will.0 -
Thanks all, that's what I had thought so good to get it confirmed.
KP I've been keeping records of girls for several years now. I'm generally against insurance so my "insurance" is that while I'm here to manage, there is enough cash to meet the expected IHT bill.0 -
You need to give away more than your NRB of £325k in the last 7yrs before any IHT would be due on the excess over £325k.
If you are gifting regularly can you claim that your gifts are from excess income? If so and you keep the records to prove it those gifts are immediately free of IHT.0
This discussion has been closed.
Categories
- All Categories
- 343.2K Banking & Borrowing
- 250.1K Reduce Debt & Boost Income
- 449.7K Spending & Discounts
- 235.3K Work, Benefits & Business
- 608.1K Mortgages, Homes & Bills
- 173.1K Life & Family
- 247.9K Travel & Transport
- 1.5M Hobbies & Leisure
- 15.9K Discuss & Feedback
- 15.1K Coronavirus Support Boards