gift tax

[jkdl21520]

I would like to know how much i can give in anyone tax year, to my grandchildren who live in the uk.
Also to my son who lives in the Isle of man and is a manx resident.
Thankyou.
alanta.

[Lee Young]

The simple answer is as much as you have or as much as you want.

We can all give away £3000 per tax year with no ongoing inheritance tax consequences. Give away more and the excess remains taxable in your estate if you were to die within 7 years of the gift.

You can also give away any number of small gifts, a small gift being an amount not exceeding £250.

IN addition gifts can be made on marriage.

[King_Maker]

The other main IHT inter vivos Exemption is gifts out of income.

There is no limit on these. But, broadly speaking, they must be on a regular basis and not dercrease the donor's standard of living.

Note that gifts of property could give you a CGT liability.

[CWatters]

Actually I believe you can also carry forward £3000 from the previous year if you didn't make a gift that year. So it's £3,000 + £3,000 + £250 = £6,250 to one person and £250 to others. I don't think the £250 can't be carried forward.

Anything more is a PET (Potentially Exempt Transfer) but you need to live for 7 years to escape IHT as others have stated.

Note it is best give it direct to the grandchildren...

If you give to grandchildren any income is taxed as the childs (but they probably aren't tax payers).

If you give it to your children who in turn invest for your grandchildren then any income over £100 is taxed as the prents (your childrens) and they probably _are_ tax payers.

[Lee Young]

You can not give £6250 to one perosn as the small gift exemption (£250) can only be given to someone who does not receive any other gift in that tax year. In the circumstances outlined above the £250 would be carried forward for 7 years, and only then escape IHT on death