Inheritance tax (IHT) planning
There are a number of ways that children can help to reduce the size of your estate and in turn it’s Inheritance Tax (IHT) Liability.
You can give away £3,000 a year with no IHT implications whcih means a poteinal saving of £1,200 in future IHT charges. Mother and father can, therefore, give away £6,000 each year and if they forget one year they can double up the next year.
Gifts of interest
You can lend your children money, e.g to buy their first house, interest-free wthout having to worry about IHT on the lost interest. Please note, however, that the loan will have to be repaid to the estate on your death.
Gifts on marraige
Parents can give £5,000 and grandparents £2,500 on your child’s marraige and this will be exempt from IHT
Gifts to upto £250 are exempt from IHT.
To explore these and more ideas contact us at A&C Chartered Accountants