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Tax-Free Gifts to Children and Grandchildren: IHT Guide

Tax-free gifts to children is a best way of passing wealth to the next generation, it is a primary concern for many families, yet the complexities of Inheritance Tax (IHT) often cause unnecessary anxiety. With the headline rate of IHT set at 40%, careful planning is essential to ensure your children benefit as much as possible from your estate.

Fortunately, there are several tax-efficient strategies available that, when used properly, can help you make significant lifetime tax-free gifts to children.

Using Allowances And Exemptions Wisely

One of the easiest ways to give tax-free gifts to children or grandchildren is the annual exemption. The annual exemption lets you gift up to £3,000 each tax year without incurring IHT. If you haven’t used the previous year’s allowance, you can carry it forward, potentially doubling the amount to £6,000, or even £12,000 for couples. These sums can add up to a substantial nest egg for children over the years.

Tax-Free Gifts to Children and Grandchildren: IHT Guide Learn to make inheritance tax-free gifts to children and grandchildren using annual exemptions, seven-year rule, regular gifting from surplus income

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Over a third of first-time buyers rely on advice from family rather than brokers Over a third (39 per cent) of younger first time buyers are primarily relying on advice from friends and family rather than a broker for support on the homebuying process, research from Coventry for intermediaries has revealed.

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