Giving money away

My understanding is that if your estate qualifies for IHT and you have gifted money within 7 years of your death, your children won’t be billed for anything. They will just inherit a bit less.

If I’m right, there is nothing to lose by doing it- they will have the benefit of a bigger house, the house will, presumably increase in value, and if they miss out on 40% of the cost in the form of slightly lower inheritance they are still in profit by a lot.

Franbern

Paying for them to have work done, is still a gift. The idea of having the invoices made out to you to get round this is fraught with criminality and danger,

One may give out of income. That is legal, done all the time.

Paying for them to have work done, is still a gift. The idea of having the invoices made out to you to get round this is fraught with criminality and danger,

Bea0802

If they're having building work, would paying the bills get around it?

We have thought of this! Paying for some major work, rather than giving them the money.

Not sure if this would work. But can you have the invoices etc for the works carried out be made out to you and then you pay the invoices?

well yes, that seems standard practice, doesn't it?

Once again, thank you.
I appreciate everyone taking time out to reply.
To those who suggested I could pay some of the building expenses myself, I do not live near my family and, more importantly, the building work is quite complex as the house is very old. Better they pay direct in case there are subsequent issues.
Finally, just to advise others that may be thinking of doing what I propose to do….
I went into my High Street ( UK) bank yesterday and asked to transfer £40,000. I don’t do internet banking.
They advised that I have to return with my passport and be prepared for a 30 minute session with the bank clerk to ensure I am not money laundering.

BlueBelle

She’s been banned

I wondered why no messages from her recently. I always thought her responses were very useful and could be relied upon to be correct.

Under Chat Downton Abbey electrical curling tongs posted by Matilda May.

Enter curling tongs in the search box and you will find the thread Mt61.

ronib

Mt61 have a look at the discussion about curling tongs and Downton Abbey…. Not even politics.

Not sure what you mean?

I am politely asking, why do posters keep repeating the advice already given?

A spade is called a shovel in America.

Mt61 have a look at the discussion about curling tongs and Downton Abbey…. Not even politics.

tattygran14

It’s a shame GSM isn’t here, I thought we were a bit old to be snowflakes. Obviously not. Apply gun to foot, etc.

Who’s the snowflake, not GSM, that’s for sure but quite a few on here!

I didn’t mean to type shovel!

Welbeck -

In response to your question,

What does it mean when someone says let's just call a spade a spade?
Case in point, the expression "to call a spade a spade." For almost half a millennium, the phrase has served as a demand to "tell it like it is

Great shame to read GSM has been banned. Why? She always offered very helpful constructive advice and obviously knew her stuff. Was that why she was banned?!

You can give away any amount of cash as gifts to whoever you like as there are no actual limits BUT there are ramifications involving limits in the following circumstances.

1. If you die within 7 years of the date of making any cash gifts , the value of your your estate includes gifts made during that period over the permitted annual gift allowances, and if inheritance tax is triggered, this will have to be paid.

2.
If you don't die but need to into care home and can't afford to pay the fees yourself, the local authority can look at previous disposals of assets or cash and treat the gifts as intentionally depriving yourself of capital, particularly if the gifts were made as a deliberate attempt to avoid paying for care home fees. There are no annual limits or thresholds for intentional deprivation, but if you were in good health at the time of the gift and a good few years have lapsed, such gifts are unlikely to be treated as intentionally depriving yourself of capital.

While not relevant to OP question, if you gift other forms of property away such as a house or a valuable painting for example, you may have to pay capital gains tax on the notional value of the hypothetical gain from the disposal during the relevant tax year.

Always take professional advice before taking any significant financial decisions.

why do you call a spade a shovel ?
they are two distinct items.
a spade is for cutting/digging.
a shovel is for scooping debris/soil.

People may do as they wish with income.

Inheritance Tax - normal expenditure out of income.

(The link not working but searchable).

Why not pay the builder for them instead of making a gift?

Do please consult a solicitor and accountant. I did something similar a few years ago. As it was a rental property (as you say yours was) there was capital gains to pay as well as the inheritance tax liability. Accountant sorted it all and well worth the money.

tattygran14

It’s a shame GSM isn’t here, I thought we were a bit old to be snowflakes. Obviously not.

I’m definitely no snowflake I call a spade a shovel but sometimes GSM comments made my eyes pop out like organ stops!!!

It’s morally wrong though ….