inheritance tax

7 year rule

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Hi, 

does anyone know about the 7 year rule about inheritance tax. 
 

if someone dedcides to gift a property to their loved ones does the property gifting need to be mortgage free? 

Replies (12)

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RLI
By lionofludesch
26th Nov 2022 16:35

What sort of loved ones?

It makes a difference.

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Replying to lionofludesch:
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By Paul Crowley
26th Nov 2022 17:21

Agree
@OP
The question appears to be asking people if they know.
You are likely to get answers that just say yes

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Replying to Paul Crowley:
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By Tax Dragon
26th Nov 2022 18:32

Paul Crowley wrote:

You are likely to get answers that just say yes

My answers to the questions are yes and no respectively.

Just yes doesn't cut it, IMHO.

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Replying to lionofludesch:
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By Nadeem1
26th Nov 2022 18:02

To son or daughter.

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By David Ex
26th Nov 2022 17:19

Nadeem1 wrote:

if someone dedcides to gift a property to their loved ones does the property gifting need to be mortgage free? 

There will probably be a problem (and certainly a cost to) transferring a property which is subject to a mortgage. The lender won’t want to see their security diluted.

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By Paul Crowley
26th Nov 2022 17:25

'if someone dedcides to gift a property to their loved ones does the property gifting need to be mortgage free? '
Best ask the lender
For tax purposes, what was given?

Are you about to become insolvent and looking to give away your house that has a mortgage on it?

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By Hugo Fair
26th Nov 2022 18:11

You've asked two unconnected questions (albeit the first is missing the question-mark):

* "does anyone know about the 7 year rule about inheritance tax?"
The vast majority of people here will 'know about' PETs - but not necessarily in sufficient depth to accommodate your underlying real question (which will involve you providing a LOT more detail regarding your circumstances & your objectives .. to a level not suitable for a public forum).
You could make a start at https://www.gov.uk/inheritance-tax/passing-on-home

* "if someone decides to gift a property to their loved ones does the property gifting need to be mortgage free?"
Impossible to answer as it stands.
- What type of property?
- Located in which country?
- Does property have any current incumbents (with/without tenancy rights)?
- Currently owned by 1 or by more people? (and not by a company)?
- What is relationship of these 'loved ones' to the person(s) gifting property?

Plus a lot more missing info - but arguably the biggest:
- Are you only interested in the IHT impact (and not other tax implications)?

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Brunel
By Brunel
27th Nov 2022 09:04

Please engage an Accountant to advise you - there could be better ways to achieve your goals, and this could be a minefield.

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Replying to Brunel:
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By Paul Crowley
27th Nov 2022 17:08

BOOM
Based on the follow up question today

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By SteveHa
28th Nov 2022 12:10

No mention of any other PETs or CLTs. It could just as easily be a 14 year rule.

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By nick farrow
28th Nov 2022 15:59

CGT on gift?

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By Banzai
29th Nov 2022 10:58

how about the classic tax answer :-

it depends

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