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Where Taxpayers and Advisers Meet

IHT Clause in Will

vickers
Posts:1
Joined:Wed Nov 11, 2020 10:17 pm
IHT Clause in Will

Postby vickers » Thu Nov 12, 2020 8:40 am

Hi, my Estate is £3M and will attract IHT. I’m now 75 and want to leave matters resolved for my son, by writing a new Will, replacing a 2014 version, where he will be the sole Executor and beneficiary.

On 1 July 2019, I gifted him £144k to help him buy a house. If I pass away before 7 years are up in July 2026, I believe he’ll have to pay some tax on that Gift.

What wording should I add to my new Will so my Estate pays the Tax on the July2019 Gift, rather than my son doing so? Thank you.

maths
Posts:8507
Joined:Wed Aug 06, 2008 3:25 pm

Re: IHT Clause in Will

Postby maths » Thu Nov 12, 2020 8:20 pm

It may well be the gift gives rise to no actual IHT if father has an unused nil rate band(NRB) (£325k) or at least £144k at the date the gift is made and father dies within 7 years.

In the absence of a NRB then it should be possible to work out the maximum/minimum IHT charge which might arise (as this amount may be tapered) and then simply leave this amount as a cash gift in will to son tax free.


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