{"id":43808,"date":"2023-10-22T06:19:10","date_gmt":"2023-10-22T06:19:10","guid":{"rendered":"https:\/\/histarmar.net\/?p=43808"},"modified":"2023-10-22T06:19:10","modified_gmt":"2023-10-22T06:19:10","slug":"inheritance-tax-seven-year-rule-that-lets-you-gift-money-without-paying-hmrc","status":"publish","type":"post","link":"https:\/\/histarmar.net\/world-news\/inheritance-tax-seven-year-rule-that-lets-you-gift-money-without-paying-hmrc\/","title":{"rendered":"Inheritance tax seven-year rule that lets you gift money without paying HMRC"},"content":{"rendered":"

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The seven-year rule is designed to encourage people to make gifts or transfer assets during their lifetime, rather than waiting until they die and potentially incurring a larger tax liability for loved ones.<\/p>\n

Britons are often told by experts that they will have to take action if they want to avoid leaving their loved ones with a hefty bill when they pass away.<\/p>\n

Gifting is a great way to lower one\u2019s IHT bill however there are rules which can leave people paying more.<\/p>\n

To cut one’s bill to potentially zero, they can follow the seven-year rule when gifting.<\/p>\n

Many people are unaware of this and are confused when they are left to pay tax on a gifted asset.<\/p>\n

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An expert has explained it is an unpopular form of taxation in the UK because people are potentially paying tax for a second time on assets (money and possessions) that were taxed.<\/p>\n

Current rules mean that typically each family will pay 40 percent tax on all assets inherited over \u00a3325,000.<\/p>\n

The only exception to this rule is the family home. If it\u2019s left to a direct descendent (children, grandchildren, or spouse\/civil partner) the tax-free allowance can be increased by \u00a3175,000 to \u00a3500,000.<\/p>\n

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Tom Biggs at Wellers explained to minimise the Inheritance Tax the family will have to pay, people can either reduce the size of their estate or increase their tax-free allowance.<\/p>\n

Of the two, reducing the size of one’s estate subject to inheritance tax may be the easiest, and can be achieved through \u2018gifting\u2019 assets.<\/p>\n

Mr Biggs said: “Gifting assets to a spouse\/civil partner or charities is instantly tax-free. You can gift up to \u00a33,000 per tax year to anyone in one go, and as many gifts of up to \u00a3250 as you like. There are also special allowances if your children or grandchildren are getting married.<\/p>\n

\u201cOne thing to remember is the 7-year rule for gifting assets. If you survive seven years after gifting, Inheritance Tax typically shouldn\u2019t apply.<\/p>\n

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