What is the 7-year rule for IHT?

Gifts made more than 7 years before death are completely exempt (PETs become exempt). Gifts within 7 years use taper relief: full IHT if 0-3 years, then reducing by 20% per year to 40 years.

What is the annual gifting exemption?

£3,000 per year can be given free of IHT regardless of when you die. Plus £250 per person per year to any number of individuals.

What are normal expenditure out of income gifts?

Regular gifts made from surplus income (not affecting your standard of living) are immediately exempt from IHT with no £3,000 limit. Requires pattern of giving.

UK Inheritance Tax Gifting Strategy Calculator

Calculate the IHT impact of lifetime gifts. 7-year taper relief: 100% IHT at 0-3 years, tapering to 0% after 7 years. PET vs CLT treatment. Annual exemptions and gifts out of income.

Principal ($)

Annual Rate (%)

Years

Compounding / Year

$ Finance Disclaimer: These calculators are for educational and illustrative purposes only. Results do not constitute financial advice. Consult a licensed financial advisor before making investment or borrowing decisions.

How to Use

Enter the values for the scenario you are assessing. Calculate the IHT impact of lifetime gifts. 7-year taper relief: 100% IHT at 0-3 years, tapering to 0% after 7 years. PET vs CLT treatment. Annual exemptions and gifts out of income. Use the uk iht gifting strategy result to inform your calculation.

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Frequently Asked Questions

What is the 7-year rule for IHT?

What is the annual gifting exemption?

What are normal expenditure out of income gifts?