If they gift you cash, provided they survive 7 years, and do not benefit from the gift they have made to you, there will be no Inheritance Tax. This assumes of course their allowance of Â£263k has already been used up through their other assets. [If their net estate is less than the Â£263k then ther is no IHT anyway.]
One way of gifting cash, (which although not necessarily appropriate in this case) that you/they may like to consider is through a Discounted Gift Trust.
This would allow your parents to gift some of their cash away to you and your brother through a Trust (normally in an Investment Bond). You would not be allowed to touch the gift until the inevitable happened to both your parents, but they would be allowed to take a tax free income FOR LIFE, from the gift they have made to you.
The result is that on starting the trust and making the gift, a considerable portion (e.g. 50% for a healthy 70yr couple) of the amount put into it would be immediately classed as outside the estate for Inheritance Tax purposes.
After 7 years the whole amount is then outside the estate, and you have then avoided Inheritance Tax on complete gift. But of course your parents are still receiving the tax free income for life which they can use towards living expenses, or perhaps to pay rent to you.
As you can see with a Discounted Gift Trust your parents are removing capital from the value of their estate, thus reducing IHT, but still receiving a tax free income to live off/pay rent.
Investment and Inheritance Tax Planner
Zurich Advice Network
e mail: email@example.com
Tel: (office) 0208 437 2500 (m) 07957 440 724
[I advise on Inheritance Tax Planning, and specialise in Discounted Gift Trusts and Investments in general]