IHT and Gifts

April 30th, 2008

Thousands of bereaved families could suffer intrusive tax investigations and fines as part of a new drive by HM Revenue and Customs (HMRC) to clamp down on inheritance tax.

HMRC is trawling through financial information such as bank statements and pension plans, to make sure any gifts made during the seven years before the donor’s death have been accurately declared. Gifts, without reservation, made more than seven years before the donor’s death are exempt from inheritance tax. There are also annual exemptions, details of which you can get from your local tax office. to cover yourself.

We suggest that if you give away any money or assets, you write down what you have given, to whom and when. Then tell your executors where they can find this information. If inheritance tax is due, it is levied at 40% on assets exceeding the annual allowance, which is £300,000 for this tax year.

Entry Filed under: News