WAE IHT Flashcards
What are the 4 exemptions/reliefs that apply to both lifetime transfers and upon death?
Spouse exemption = can transfer an unlimited value of property between spouses (nil rate band can also be transferred)
Charity exemption = any gifts made to charities/political parties with at least one elected representative
- DEDUCT this from the chargeable estate
Business property relief = must be a trading company; must have owned shares for at least 2 years at time of transfer
- 100% reduction if (a) business/business interest (b) unquoted shares
- 50% reduction if (a) quoted company shares if transferor had voting control (over 50%) (b) land/buildings/machinery/plant owned by transferor personally but used for business purposes by company where transferor had voting control
Agricultural property relief = reduction of 100% for anything beginning on/after 1 September 1995; reduction of 50% on everything else
What are the exemptions/reliefs that only apply to lifetime transfers?
Annual exemption = can transfer £3,000 each year; exemption can be carried forward one year
Small gifts = make an unlimited number of gifts of £250 as long as they are not given to the same person in one tax year
Normal expenditure of income
Gifts in consideration of marriage = (a) £5,000 from parents (b) £2,500 from remoter ancestor (c) £1,000 in any other case
