grandparent cash gift

johnboatman@btconnec · Postby **johnboatman@btconnec** » Sat Oct 16, 2004 3:33 am

My father-in-law wishes to give my wife and I a cash gift. He has made no previous gifts,what is the maximum allowable. Do we have to declare it to the inland revenue,are there any tax implications for us? Should my father-in-law declare this payment and do we need to keep records. thankyou for any assistance

cranleys · Postby **cranleys** » Sat Oct 16, 2004 12:12 pm

John

There is nothing to worry about. He and You will need to record this. Assuming Father-in-law survives 7 years you have no issues.

I can offer you and your father-in-law some IHT advice so he can have the whole picture.

Colin Davison
01256-766655
Cranleys Chartered Accountants

Arnold Aaro · Postby **Arnold Aaro** » Mon Nov 08, 2004 5:29 pm

If your father in-law is considering gifting higher amounts of cash, but doesn't feel he is able to as he needs to keep money behind for his own use, a Discounted Gift Trust may be useful here.

This would allow him to gift a sum of cash to you, but would allow him to take a regular tax free income from the gift he has given you, for life. This would not break any IHT rules, including Gift with reservation of benefit, and finance Act 2004 too.

This means ultimately you would reduce very much more any IHT bill in the end.

Feel free to contact me directly if you want more info on this.

Arnold Aaron
Investment and Inheritance Tax Planner
Zurich Advice Network
e mail: arnold.aaron@zurichadvice.co.uk
Tel: 0208 437 2500

[I advise extensively on Inheritance Tax Planning, particularly Discounted Gift Trusts and Investments in general]