Edward Heard

Hi HMRC Admin 25. I managed to speak to someone on the helpline. However I am not sure that they advice received is accurate. If I refer to your webpage: "How Inheritance Tax works: thresholds, rules and allowances". It would infer that if you die within 7 years of gifting, the amount of tax to pay depends on if inheritance tax is due and when the gift was given. If the persons estate is minimal such that the £325,000 allowance is hardly consumed the remainder would offset the gift amount given right? Day1: Gift 250,000 Day2: Death. Remaining estate is valued at 75,000 IHT allowance remaining: 325,000 - 75,000 = 250,000 Therefore, gift on Day1 is NOT subject to any IHT liability, it is tax free. Is that correct?

Hi HMRC Admin 25. I tried to call the general enquiries line as suggested. However I get an automated message telling me that the number is no longer in use. What is the right number to call please. Can you also update the web page to list the correct number. Thanks

Hi I am looking for some clarification on HMRC rules regarding the gifting of monies and IHT….. My parents-in-law are suffering from various old age related issues, including dementia. They are considerable remote from us and approaching the point where they are unable to care for themselves. We are thinking that we will need to look after them at our house. In order to do this they are considering selling their house and gifting the proceeds to us such that we can build an Annexe on our property for them to live in (Rent free). Can you clarify the HMRC rulings in regards to this proposed action and whether or not their gifting of the house sale funds would … 1. Give rise to any Capital Gains tax implications – their current house is their sole residence 2. Be considered as a “Gift with Reservation” as they intend to live with us (rent free) in the Annexe we build on our property using the funds they gift from the sale of their property. The Annexe would be owned by us. The sale proceeds would not exceed £325,000. As the monies would be gifted effectively by both parents (jointly) … 1. Does an IHT consideration in respect of the monies gifted ONLY arise on the death of the last surviving parent? 2. In our scenario am I right in assuming that worst case, should they die within a year of two of this the gifted monies would be considered as part of their estate and IHT would be due only on the part that exceeded the IHT threshold, currently the threshold is higher than the gift expected. 3. If subject to an IHT calculation is the threshold value to apply determined at the time of passing or is it that which applied when the gift was made? In other words what happens if after we accept the gift the IHT threshold drops to Nil and they die within a year. 4. The 7 year rule calculation, is this determined from the time of passing of the last surviving parent i.e. what happens if one parent dies within a year and the other lives for another 10 years? Many thanks for your help in clarifying the HMRC rulings in this area.