Wills & Estate Planning Fact Sheet

There are some allowances for giving money away within your lifetime that would be exempt for Inheritance Tax purposes which can be summarised as follows: 

  • You can give the sum of £3,000 away in any tax year which is completely exempt of any Inheritance Tax. 
  • You are also allowed to give away up to the sum of £250 to as many different people as many times as you like during any tax year as long as they are not the same person who has already benefited from a £250 gift or the £3,000 yearly allowance. 
  • You are able to give gifts of money out of your normal monthly income without this being taken into account as gifts given away as long as you still have enough money of your monthly income to carry on your normal lifestyle. 
  • Each tax year, you can give a tax-free gift to someone who is getting married or starting a civil partnership. You can give up to: 
  • £5,000 to a child 
  • £2,500 to a grandchild or great-grandchild 
  • £1,000 to any other person 

If you’re giving gifts to the same person, you can combine a wedding gift allowance with any other allowance, except for the small gift allowance. For example, you can give your child a wedding gift of £5,000 as well as £3,000 using your annual exemption in the same tax year. 

  • You can give Christmas and birthday gifts as normal. 
  • No tax is due on any gifts you give if you live for 7 years after giving them – unless the gift is part of a trust. This is known as the 7-year rule. If you die within 7 years of giving a gift and there’s Inheritance Tax to pay on it. the amount of tax due after your death depends on when you gave it. Gifts given in the 3 years before your death are taxed at 40%. Gifts given 3 to 7 years before your death are taxed on a sliding scale known as ‘taper relief’. Taper relief only applies if the total value of gifts made in the 7 years before you die is over the £325,000 tax-free threshold

Taper Relief is as follows:

Years between gift and deathRate of tax on the gift
3 to 4 years32%
4 to 5 years24%
5 to 6 years16%
6 to 7 years8%
7 years or more0%

Fact Sheets

These advice sheets give you some general information about Wills & Estate Planning.

Meet The Team

Our team is here to help guide you through the process and to ensure you are well informed when making such important and sensitive decisions. Please call 01782 262424 for an appointment or email a member of our team.

Our Accreditations

Natalie Fawcett is a full member of the Society of Trusts and Estate Practitioners. This is a qualification that only a small number of legal professionals have obtained in the area.