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TaxRobin
TaxRobin, Tax Consultant
Category: Tax
Satisfied Customers: 15610
Experience:  International tax
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My elder daughter is the executor of my estate. If I give her

Resolved Question:

My elder daughter is the executor of my estate. If I give her money in trust to be divided equally between her and her younger sister, how does this affect her tax status? Does she have to declare the full amount as income? She is married with two children and does not currently generate any income of her own.
Submitted: 2 years ago.
Category: Tax
Expert:  TaxRobin replied 2 years ago.
Hello and thank you for allowing me to assist you.
Your estate may not have to pay Inheritance Tax on assets you gave away as gifts while you were alive.
An amount you were to gift now would be removed from your estate should you survive 7 years past the gift. If you don’t your estate or your daughters, who received it, will have to pay Inheritance Tax on it.
Your daughters would not be taxed on the amount you gave them if the 7 years is met by you.
Anyone who receives a gift from the deceased in the 7 years before they died may have to pay Inheritance Tax if the deceased gave away gifts worth more than £325,000 in that time.
Customer: replied 2 years ago.

Your reply refers to Inheritance Tax but I am also questioning whether the gift has to be included in the annual joint tax return that she and her husband file as part of their joint income for the year in which it is received?

Expert:  TaxRobin replied 2 years ago.

There is no gift tax that would apply. Your daughter would have no tax to pay.

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