Capital gains queries and yearly gift allowance

[Jaytee73]

In 2006, I was gifted the sum of £150,000.00 which with the 7 year rule would have been exempt from tax in 2013.

Unfortunately for an income reason, I gave the money back in 2011 but received it back in the same year and therefore I am led to believe that the 7 years rule reset and therefore it is tax exempt from this year.

In November 2016, I was gifted a further £90,000 and I believe that the monies will be exempt from inheritance tax in November 2023 but I wondered if during this period I can still be gifted £6000 each tax year; £3000 each from my parents. Also, a large proportion of the £90K was invested into premium bonds and I have won about £500 in prizes. If I ended up paying inheritance tax on the £90K, would I pay tax on my premium bond winnings due to the monies being earned with taxable money? I am due to by a house and I've been offered the chance to have substantial work paid for but even though I wouldn't see the money and just the material benefits, is this effectively a taxable gift? I would be very grateful for any advice on these matters. Many thanks

[AGoodman]

1. Yes, annual exemption entirely separate
2. Profits from gifts irrelevant
3. In any case, the first £325k of gifts made by a deceased in the final seen years are absorbed by their nil rate band. This might increase the tax payable by the estate but the liability does no liability falls on the recipient of a gift unless the aggregate prior gifts (made to all persons) were greater than the nil rate band.
4. Yes, a gift in kind is still a transfer of value. The test is whether the transaction reduces the total wealth of the donor.

[Jaytee73]

Hi AGoodman, thanks very much for your information. I'm very grateful. Many Thanks