money gifts to family

[zaramac]

Could someone please remind me of the rules regarding money gifts to family members? I would like to help my family out in these hard times, but seem to remember some restrictions.

[anniebird]

You can give as much as you like to anyone without restrictions as long as you live for 7 years after the gift. If you die before then the gifts are added back to your estate before IHT is calculated. These are known as Potentially Exempt Transfers. There is a reduction if you live more than 3 years. You can give upto £3,000 in any one financial year (6th April to 5th April following year) without it being added back to your estate as above and if you did not give anything last year you can use that year's allowance and give £6,000 this year.

[zaramac]

Thanks, anniebird.

[trainers]

Anniebird, if you are giving or have given large sums away(325k plus) it would be worth speaking with a tax expert or financial advisor to make sure you are aware of the possible consequences. Rules have changed and are changing all the time

[Captain Spod]

Sorry for the delay, only just catching up after a holiday. In addition to the above, which is all correct, you can also give away anything which does not reduce your capital so reducing your estate. The easiest way to prove this is by setting up a regular payment to the beneficiary. These regular gifts fall outside IHT as long as they are affordable and so are in addition to those listed above.