Gift from surplus income

[pandora_boite]

I have heard that gift from surplus income don't fall under the 7 year rule if a regular pattern of gifting is established.

Does this apply to non residents as well?
To provide some context:

I am retired and now live in the EU and live off my 401k pension that I accumulated while working in the USA.

I used to live and work in the UK and still own the house I used to live in. This is now rented out, and this income is received in the UK. After house maintenance and repair costs and UK taxes some rental income is left over, which I would like to gift to my children each month.

Would this gifting be considered gift from surplus income by HMRC? Is there any paperwork that should be put in place to ensure that this is treated as such in case HMRC questions this when dealing with my estate.

Many thanks for any insights.

[AGoodman]

Residence isn't an issue for inheritance tax as such but these sound like UK gifts anyway so would be subject to IHT.

yes, these could be gifts out of surplus income provided it is genuinely surplus - i.e. you cover all your living expenses from your other income such as pension.

To make life easier for your executors should it be required, you shoudl keep the info set out on page 8 of this document:

https://assets.publishing.service.gov.uk/media/5f60b44cd3bf7f7234487bf0/IHT403-05-20.pdf

You might want to consider if your estate is within IHT anyway if you are not long-term resident here - which will depend on the value of your UK assets.