Call Richard Cook: 07770 575 122

email: richard@theinvestmentandretirementcoach.co.uk

IHT Gifting: making the most of the exemptions

One of the greatest joys of being a parent or grandparent is helping out children and grandchildren financially, whilst reducing potential inheritance tax bills.

Unfortunately this is not as simple as it should be and there are many pitfalls to avoid. Getting guidance/advice is also not straightforward. Legal fees are expensive as is advice from a regulated financial adviser.

A recent article from Hargreaves Lansdown is very good but everyone’s circumstances are different and you cannot beat personal guidance.

If you would like to know how I can help just phone or text me on 07770 575122 and let’s have a preliminary chat – no charge.

The exemptions which mean that gifts are tax-free are:-

  • Annual Exemption – in each tax year you can make a gift of up to the annual exemption of £3,000 and also use the previous year’s allowance.
  • Gifts from income – if you can make regular gifts from your post-tax income without effecting your standard of living they are tax free. HMRC will expect your executors to come up with the evidence to prove that this exemption applies so good record keeping is essential.
  • Marriage gifts – parents and grandparents can make one-off marriage gifts of of up to £5,000 and £2,500 respectively.
  • Small gifts – in each year you can gift up to £250 to any number of people as long as they haven’t received a gift covered by one of the other exemptions.


But you do need to survive for 7 years or there will be a tax charge on your death.

Many of my clients have been much happier making gifts to a Trust which provides a great deal of discretion and control over who benefits from the trust funds and when. This has become even more important as divorce rates have climbed and money gifted to help with house purchase has been included in the divorce settlement. A loan from a Trust rather than an outright gift  should avoid that issue.

The maximum which can be gifted to a Trust in any 7 year period without incurring an immediate tax charge is £325,000.

IHT receipts continue to increase but with some careful planning there is no reason why your hard earned money should be contributing that that increased tax take.

If this is of any interest to you, or perhaps your parents, text or phone me, Richard, on 07770 575122 and let’s have a chat.


This document and our on going services are not personal advice. We'll give you all the help and guidance you need to make your investment and retirement decisions, but we can't advise you. If you're not sure whether you need regulated financial advice we can put you in touch with a suitably qualified and experienced regulated adviser. Because we are not regulated by the Financial Conduct Authority you will not have access to the Financial Ombudsman Service in respect of any complaints. If you use one of the "no advice" on line services to handle investment transactions they will be Regulated and you will have access to the Ombudsman and The Financial Compensation Scheme in respect of their services. The value of investments/pension plans can fall or rise depending on market performance. The Retirement Team and The Investment and Retirement Coach are trading names of Capture Success Ltd Reg No 01825075 Tel 07770575122

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