Making gifts to family and friends can be a good way to reduce the value of your Estate for Inheritance Tax purposes.
There are various gifts that can be made which are tax free:
- Gifts to spouses (limited to £325,000 if … is non-UK domiciled)
- Gifts to UK charities
- Certain marriage gifts – for this to be exempt, the gift has to be given before the wedding and the wedding has to happen.
The exceptions are as follows:
- Children – up to £5,000
- Grandchildren – up to £2,500
- Other relative – up to £1,000
- Small gifts – you can give up to £250 per person and you can gift this to as many people as you wish during the year.
- Annual exemption (£3,000 per tax year) – any unused allowance can be carried forward to the following tax year, however it then must be used in that year and cannot be carried forward to any future years.
If you would like some further advice on Estate planning, then please do not hesitate to contact Megan Hall