Tax on Cash Gift for House Deposit

Hi all, I am a first time house buyer with a £40,000 deposit consisting of £20k of my own money and £20k cash gift from a relative. I have a question regarding that £20,000 cash gift from my grandad and whether I'll need to pay inheritance tax on it should be pass away within 7 years. I'm aware of the 7 year rule on cash gifts and inheritance tax, but in all honesty he likely doesn't have that long left. His total estate is around £380k. I've tried googling but there isn't a clear cut answer I can find. Any help appreciated!

Hi

Your grandfather is the person who needs to record the gift for inheritance tax purposes.  If he should pass away within 7 years of making the gift, then the gift is included in your grandfather's estate for inheritance tax purposes.  
Please have a look at How Inheritance Tax works: thresholds, rules and allowances.

Thank you

Hi My partner has been given £20K towards a deposit for a house, we very much expect her parents to live for more than 7 years, would we pay tax on this money?

Hi Charlie,
HMRC do not consider gifts to be taxable income for the receiver, but it can give rise to inheritance tax for the giver.
 How Inheritance Tax works: thresholds, rules and allowances
Thank you.