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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
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Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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We are just about to sell my mothers property, she is

Resolved Question:

Hi,
We are just about to sell my mothers property, she is now in a care home with costs that she will have to contribute towards. I will bullet point below questions which I hope you can guide me on
We are aware that we can give gifts of £3k a year in total,backdate for 1 year, and understand that, are other additional amounts for birthdays ect allowed on top of this?
Are we able to give away larger sums, eg - 10k to each of 3 children, on the proviso we follow the inheritance tax rules should my mother pass away within the next 7 years, are there other ways that we can distribute before the costs of her care eat it up !
Many thanks
Richard
Submitted: 1 year ago.
Category: Tax
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your question...You have already covered the annual exemption gift of £3,000.Gifts up to £250 - you can give individual gifts up to £250 to as many people as you like.Regular gifts from the giver's income including Christmas, birthdays and anniversary presents etc...There is a comprehensive list and itis covered under "Gifts you don't pay inheritance tax on" herehttps://www.gov.uk/inheritance-tax/giftsLarger sums would be regarded as potentially exempt transfers and the seven year rule would apply.You should be mindful that there is sufficient provision to take account of care costs.You will find this factsheet from Age UK helpful .. look at page 8 of 27 herehttp://www.ageuk.org.uk/home-and-care/care-homes/deprivation-of-assets-in-the-means-test-for-care-home-provision/ I hope this is helpful and answers your question.If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.
Customer: replied 1 year ago.
Many thanks for your reply, which has been very helpful and its clear I believe that we cannot give larger sums away as it would impact on my mothers funds available for her care. Just to make sure I have a full understanding of the gifts part,
So am I correct in saying that for example I could receive, £250 for my birthday (October) and then £250 as a gift at Xmas, and the same could be done for my brothers and sisters ?, is this possible even if this would not be normal in my mothers spending patterns.
Thanks again, I am happy with your service and rate you accordingly.
Regards
Richard
Expert:  taxadvisor.uk replied 1 year ago.
Richard, thank you for your reply...To be honest, giving you and your siblings £250 each for birthdays and Christmas is not really substantial expenditure. She may have given smaller sums in the past. I won't unduly worry about gifts of this size.If she were to give you £1,000 each, then it would be another story. I hope this is helpful and answers your question.If there are no more issues, I will appreciate if you would kindly rate my service/accept the service I have provided before you leave the site, to ensure I get credited for it by Just Answer.
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Expert:  taxadvisor.uk replied 1 year ago.
I thank you for accepting my answer.
Best wishes.

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