GIFTING

The season of giving is here and although inheritance tax may be far from your mind, it’s always worthwhile to consider the rules on gifting.

Small gifts such as Christmas or birthday gifts do not form part of your estate for inheritance tax purposes as long as they are made from surplus income and do not prevent you from maintaining your usual standard of living. You can make unlimited gifts of £250 per person as long as you have not used another exemption on the same person.

Every person has an allowance of £3,000 per tax year. This can be given to one person or divided between several. If you didn’t use last year’s allowance it can be carried forward but only for one year.

You can make gifts of up to £1,000 per person (increasing to £2,500 for a grand or great-grandchild and £5,000 for a child) as a wedding or civil partnership present.

Finally, any gift that you make and survive by 7 years falls outside of your estate for inheritance tax purposes (subject to certain conditions).

If you are considering making a substantial gift and would like advice about the implications on your inheritance tax position please contact one of our friendly and knowledgeable team on 01548 855655 and ask to speak to Mandy Potter or Claire Thompson.