| A leading Wealth Management and Wills Solicitor | | | | If any gift is in the shape of Cash, Cheque or even a |
| based in the south of England have recently issued a | | | | Chattel (a sentimental piece of personal property like |
| start warning that the HM Revenue and Customs | | | | jewellery) a letter should also be included along with |
| department are very soon to implement a series of | | | | the jewellery that states the gift givers intent to give |
| strict crackdowns on the current Inheritance Tax gifting | | | | the gift. If the value is known then it should be included |
| loopholes. They further advise anyone who intend to | | | | in the letter along with the date and a signature by the |
| donate their money to their family as a "gift" should | | | | giver. |
| ensure that they make sure that they explicitly | | | | If the gift is intended as a loan, then a promissory note |
| express this to avoid a hefty inheritance tax bill. | | | | should be signed and dated by the recipient. |
| At the moment there are no specific guidelines or | | | | Avoid the use of "Side letters." A Side letter is a letter |
| methods for reporting outright gifts at the point that | | | | that explicitly states that, if for whatever reason the |
| they are made meaning that the obligation has always | | | | relationship breaks down between the donor and the |
| been centered on the executors of the estate to | | | | receiver then the donor can claim the gift back. In |
| make the HMRC aware of any gifts during the | | | | order for the gift to be free of Inheritance tax then it |
| deceased's lifetime and especially those made within | | | | must be without this regulation and any letters that |
| the last 7 years. | | | | fetter the gift to this then the gift because IHT liable. |
| However changes to these rules have meant that the | | | | A senior manager at the leading wills solicitor has |
| HMRC will no longer just focus on estates that are in | | | | claimed that the whole Inheritance Tax Process is not |
| excess of the Nil Rate Band at the time of death (and | | | | as complicated as it need be and if the right advice |
| where there is potential charge to IHT). Now the | | | | can be given it can be made a lot clearer for all |
| HMRC will look further into the estates where it seems | | | | parties. As can be seen above, correct documentation |
| that no tax charge arises in an attempt to maximise | | | | and holding proper records can make the world of |
| the 'tax take'. | | | | difference to how easily an estate can be manages |
| The Wills Solicitor further went on to advice about | | | | can speed the whole process along during a painful |
| how best to give a gift to avoid an Inheritance Tax Bill | | | | period in anyone life. |
| being levied at you: | | | | |