Fixed Probate Fees, call:

0800 612 6105

Alternatively local rate:

020 8150 2010

Tax free gifts

With the festive season just around the corner many of your clients may be thinking of making generous gifts to family members and will be looking for tax efficient ways to do this. Any cash gift to an individual is a Potentially Exempt Transfer (over certain thresholds) and will be taking into account when calculating inheritance tax should the donor die within a seven year period. The way to avoid this is by ensuring gifts are under the thresholds set. Currently an individual can give gifts totalling up to £3000 in any tax year without penalty. If the annual allowance has not been used in the previous year it can be carried forward. This means that a couple can give gifts of £6000 each where the allowance has been carried forward. Other thresholds apply to gifts given in contemplation of marriage. A parent can give a gift of up to £5000 and avoid paying tax and grandparents can give up to £2500 Don’t forget that gifts out of income rather than capital can also fall outside taxation as long as they leave the donor sufficient income for it not to affect their normal lifestyle.

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