Inheritance Tax Exemptions

Married couples and registered civil partners are allowed to pass their estate to their spouse tax-free when they die. In other words, the surviving spouse can inherit the entire estate without having to pay IHT.

You can also pass on your unused tax-free allowance to your spouse. However, gifts to your partner who isn’t married to you might incur IHT.

When to make that gift
What and how much you wish to give your children or other members of your family is completely up to you. But to ensure that it’s IHT-free, it’s important to plan when to make that gift. So long as you live more than seven years from when you make this gift, your children or family will not have to pay IHT on your gift when you die.

But if you unfortunately don’t live more than seven years after you’ve made the gift, they might have to pay IHT. During that seven-year period, your gift is known as a ‘potentially exempt transfer’ (or ‘PET’). If you do not survive the gift by seven years