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Ask Clare Your Own Question
Clare
Clare, Family Solicitor
Category: Family Law
Satisfied Customers: 34121
Experience:  I have been a solicitor in High Street Practise since 1985 and have specialised in Family Law for the last 10 years
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Re Deed of Family Arrangement: One parent gives gifts exceeding

Customer Question

Re Deed of Family Arrangement: One parent gives gifts exceeding the IHT allowance to his children 4 years before his death. His wife is still alive. Does IHT have to be paid on the sum above £325,000 at that point, or 'is the clock still ticking' on the gifts for IHT purposes until the wife dies?
Submitted: 4 years ago.
Category: Family Law
Expert:  Clare replied 4 years ago.
Hi
Thanks for using JustAnswer. My name is Claire, I will do whatever I can to answer your question.
Which parent actually gave the gifts and what has happened to the rest of his estate?
Claire
Customer: replied 4 years ago.

Hi Claire


The father gave the gifts to 3 children (£150K each) 4 years before his very recent death. There is other estate left to the children - about £300K + a house worth approx £250K. The wife has been left the husband's pension in the will but no property or money. The children, with the agreement of the mother, propose to have a Deed of Family Arrangement so that all of the estate passes to her initially and then she will gift this back to the 3 children - hopefully using her own IHT allowance. Are the original gifts of £150k to each of the children from the father seen as from him alone or are they considered to be from both parents - thereby not attracting IHT until the wife's death?


Thanks


Lucy

Expert:  Clare replied 4 years ago.
Hi
Did the money come from a joint account?
Claire
Customer: replied 4 years ago.

No

Expert:  Clare replied 4 years ago.
Hi
Then I am afraid it was clearly a gift from your father and falls to his IHT allowance
Claire