Potentially Exempt Transfers (PETs)
On your death any large gifts you made during the last 7 years of your life can be added back to your estate. Any gifts made within 3 years of death will be added back at their full value, this reduces by 20% of the value of the gift each year so that after 7 years the IHT value is nil.
This is to avoid you giving everything away on your deathbed and avoiding IHT. Generally small gifts under £250 and all gifts totalling under £3,000 per year don’t count and special gifts such as wedding presents, up to £5,000 to a child, £2,500 for a grand-child or £1,000 for anyone else don’t count either. Most other gifts will be added back to your estate on death and taxed.
At Chase Smythe 9 Ltd we specialise in estate tax planning and can help you reduce your estate’s liability and/or insure for the tax. Please call us on 03303 600 300 for an informal conversation to see if we can help.
Also see -
Tax Planning Income Tax Income Tax on Savings and Dividends
Capital Gains Tax Entrepreneur's Relief Inheritance Tax (IHT)
Write a Will Charitable Gifts Corporation Tax National Insurance
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