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TaxRobin
TaxRobin, Tax Consultant
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Experience:  International tax
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Is the annual £3000 "gift" exemption claimable against

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is the annual £3000 "gift" exemption claimable against transfers made 5 years before death or can it only be claimed against transfers in the year of death (and the year preceding that year if not used)
JA: Have you talked to a tax professional about this?
Customer: no
JA: Anything else you want the Accountant to know before I connect you?
Customer: no

Hello and thank you for allowing me to assist you.

An individual can make gifts larger than £3,000, however if they die within 7 years of making the gift and leave an estate worth more than the Nil Rate Band (NRB), plus any additional threshold available, the excess gift will use up some of the NRB; thus effectively resulting in an Inheritance Tax (IHT) liability on the excess.

Customer: replied 13 days ago.
for instance can i claim against the value of the chargeable estate of someone who has died this year (2020) £3000 against a gift made in 2015 , and £3000 against a gift made in say 2020
Customer: replied 13 days ago.
can i caim £3000 allowance against a gift made in 2015 , then say against another in 2018 , then against another n 2020 for instance, in order to reduce the value of the taxable estate for IHT purposes

An individual can provide gifts of £3,000 each tax year (6 April to 5 April) without these being adding to value of their estate on death. That is what the allowance does. It keeps it out of the estate.

YES each year that amount is used

The £3000 is just not added on it does not get subtracted because it is not included anyway. They gave it away.

Customer: replied 13 days ago.
if i made a gift of £50,000 on 2015 and die in 2020i can set off £3000 of my allowance in 2015 against the total chargeable estate for the purpose of assessing IHT payable

Yes

Customer: replied 13 days ago.
Thats great

You are welcome

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