Brendan Burgess
Founder
- Messages
- 53,618
It's interesting to see how they tax gifts and inheritances in the UK.
As far as I can make out
On death
The estate pays the IHT, not the recipients
The first £325,000 is exempt from tax
The balance is taxed at 40%
If you are married, any unused threshold is passed on to your spouse. So if you leave £125,000 , your widow can add the balance of £200,000 to her exemption giving her an exemption of £525,000
If you leave everything to your spouse, there is no IHT
If you leave your family home to a direct descendant, the £325,000 is increased to £425,000
Gifts
There is no tax on gifts when they are given.
But if you die within three years, the recipient pays 40% of the value in IHT.
This tapers down for 7 years. If you die after 7 years, there is no IHT.
Brendan
As far as I can make out
On death
The estate pays the IHT, not the recipients
The first £325,000 is exempt from tax
The balance is taxed at 40%
If you are married, any unused threshold is passed on to your spouse. So if you leave £125,000 , your widow can add the balance of £200,000 to her exemption giving her an exemption of £525,000
If you leave everything to your spouse, there is no IHT
If you leave your family home to a direct descendant, the £325,000 is increased to £425,000
Gifts
There is no tax on gifts when they are given.
But if you die within three years, the recipient pays 40% of the value in IHT.
This tapers down for 7 years. If you die after 7 years, there is no IHT.
Brendan