pikestaff
Member of DD Central
Posts: 2,187 
Likes: 1,546
|
Post by pikestaff on Dec 2, 2023 8:24:14 GMT
"Your [surplus] income is comprised of all income, including non-taxable income such as ISA interest and/or dividends and some benefits in addition to premium bond winnings," according to one expert.
[...] If you plan to make serious use of the gifts out of surplus income exemption, the expert recommends that you use IHT403 to keep a record of your income and expenditure. That is a good idea. If you do, your executors won't have any difficulty. I have been making regular payments out of surplus income, but I'd not looked at IHT 403 until a few days ago. I have a spreadsheet but it's not in enough detail. One of my jobs in the coming weeks is to upgrade it, going back as far as I can. Whether this is truly necessary is debatable. I don't think the law specifies how much detail you need, and I think what I have already is enough to demonstrate to any reasonable person that my regular payments are out of surplus income. But, the form is the form. I've decided it's wiser to give my executors what HMRC asks for.
|
|
|
|
Post by bracknellboy on Dec 2, 2023 9:18:18 GMT
"Your [surplus] income is comprised of all income, including non-taxable income such as ISA interest and/or dividends and some benefits in addition to premium bond winnings," according to one expert.
[...] If you plan to make serious use of the gifts out of surplus income exemption, the expert recommends that you use IHT403 to keep a record of your income and expenditure. That is a good idea. If you do, your executors won't have any difficulty. I have been making regular payments out of surplus income, but I'd not looked at IHT 403 until a few days ago. I have a spreadsheet but it's not in enough detail. One of my jobs in the coming weeks is to upgrade it, going back as far as I can. Whether this is truly necessary is debatable. I don't think the law specifies how much detail you need, and I think what I have already is enough to demonstrate to any reasonable person that my regular payments are out of surplus income. But, the form is the form. I've decided it's wiser to give my executors what HMRC asks for.Which indeed sounds very wise. You don't want to be leaving your executors with a puzzle they can't reasonably solve.
|
|
|
|
Post by mostlywrong on Dec 5, 2023 18:49:13 GMT
I have been transferring money to my son to help with London prices.
And I have recently increased it to more than £250/mth.
I had not realised that sum dropped me into IHT403 territory if the worst happened.
If I died tomorrow, my estate would not attract IHT but, given inflation, the freezing of the allowances until 2028 and the voracious appetite of Chancellors of all political colours for yet more tax, then I have just shot myself in the foot. Or, more precisely, the foot of my executor!
I have not yet decided what action to take but I will think about it.
So, thank you, guys, for highlighting the issue.
MW
|
|
|
|
Post by moonraker on Dec 6, 2023 16:18:30 GMT
12 x £250 would be OK as that equates to the £3,000 annual limit on gifts - assuming you don't make gifts to others.
|
|
|
|
Post by mostlywrong on Dec 14, 2023 11:21:29 GMT
12 x £250 would be OK as that equates to the £3,000 annual limit on gifts - assuming you don't make gifts to others. I have checked and I am OK because the early payments were sub-£250 and the later, higher payments are across 2 tax years, so I have some time to reconsider.
The alternative to giving money to The Boy and, potentially, paying IHT at 40% is to spend it on a 5 star skiing trip to Whistler, and pay only 20% tax on the elements that I purchase through a UK company.
Are my knees up to this?
MW
|
|
|
|
Post by moonraker on Dec 29, 2023 14:44:30 GMT
In one of last weekend's newspapers, a financial columnist noted that the £3,000 yearly tax-free allowance on gifts had been introduced in 1981 (or perhaps it was a limit), as had the £250 presents allowance. Were the £3,000 to be increased in line with inflation, it would be £11,500 today. Which would suit me very nicely indeed, indeed it would be more than enough for many years.
There's also renewed speculation that the Chancellor may abolish or reduce (to 20%) IHT. Personally I would welcome this, but would deem it politically insensitive. It would be less harmful and probably help more people to double the allowances.
|
|
