Parents use ‘pre-inheritance’ to avoid inheritance tax
Parents are avoiding giving gifts in their Willsso that their children do not fall victim to large inheritance tax bills.
This is the conclusion of a new survey carried out by Aviva, which showed a trend for ‘pre-inheritance’, the giving of gifts and assets before death rather than after.
Some 46 per cent of respondents said they had received a pre-inheritance from their parents or another relative while they were still alive.
Meanwhile, only 37 per cent reported being given their inheritance through a Will.
However, those who did choose to give pre-inheritance gifts often stipulated conditions in the same way as they would have done in their Wills, with popular conditions being that the dependents spend the money on education, property or paying off their mortgage.
“Alongside the obvious benefits of cutting the amount of money liable for inheritance tax, it also seems many benefactors like to see their money being enjoyed whilst they are still alive,” commented Aviva spokesperson Clive Bolton.
Up to £3,000 a year in money or assets can currently be given tax-free, as long as the benefactor lives for seven years afterwards.
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