Music1 min ago
iht
5 Answers
Hi I want to pay as little as possible IHT. The limit is �3000 per year that can be paid per year to anyone.Can anyone tell me is there anything stopping me paying several small amounts of cash (say �100-�200) to my son (who is buying a flat) as well as the �3000.Who knows what happens to smallish amounts of cash. Answers appreciated. James
Answers
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There is nothing stopping you giving anything you like to your son.
Whether amounts above the limit get counted for IHT depends on your honesty, the honesty of your son and of your executors - and the records available to them.
As to small amounts, it's doubtful if they'd get noticed, and if you made a habit of it might come uner the 'normal expenditure' exemption:
Normal expenditure out of income
Gifts which are made purely out of income as part of a person's normal expenditure are exempt from inheritance tax. The claimant must show that after allowing for the gifts the donor was left with sufficient income to maintain their usual standard of living and that there was an established pattern of giving.
Bear in mind that you are going to survive 7 years anyway, aren't you? (Just to look on the bright side.....)
Whether amounts above the limit get counted for IHT depends on your honesty, the honesty of your son and of your executors - and the records available to them.
As to small amounts, it's doubtful if they'd get noticed, and if you made a habit of it might come uner the 'normal expenditure' exemption:
Normal expenditure out of income
Gifts which are made purely out of income as part of a person's normal expenditure are exempt from inheritance tax. The claimant must show that after allowing for the gifts the donor was left with sufficient income to maintain their usual standard of living and that there was an established pattern of giving.
Bear in mind that you are going to survive 7 years anyway, aren't you? (Just to look on the bright side.....)
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Make sure you have named specific people on any death in service benefits and have anything like life insurance and pensions in trust.
If not then they can end up in your estate and could bump up any sum for IHT calculation.
If say you die while having death in service benefit and the payout is say 4 x your current salary, if you were on �50.00 a year then you could bump your estate up by around �200k.
If not then they can end up in your estate and could bump up any sum for IHT calculation.
If say you die while having death in service benefit and the payout is say 4 x your current salary, if you were on �50.00 a year then you could bump your estate up by around �200k.
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