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inheritance before death
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my mum is selling her house for 140,000 pounds and is moving into her boyfriends flat. From the money she has gained from the house she wants to give each of her four grown up children 10,000 pounds each can she do this without any of us having any problems ie is this to much in one lump sum plus would the children or the mother be taxed on this amount
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Estate duty doesn't kick in till over 2 hundred thousand (try tax web site for exact figure).
She has an annual allowance of �3,000 that doesn't go into the 7 year pot, and if she didn't give any large sums any last year she can give �3,000 from last years allowance this year.
So if she dies within 7 years �37,000 or �34, 000 will be added to her savings etc (excluding any left to charity which don't pay inheritance tax). Then the tax man takes 40% of anything over the threshold.
I would agree with Lady Penelope, if you accept this you should be prepared to treat it as a loan, and give it back if she needed it. (If you use it to reduce your mortgage you can increase it again if needed, and save money meanwhile, but if you spend it on an expensive holiday it's gone for ever)
She has an annual allowance of �3,000 that doesn't go into the 7 year pot, and if she didn't give any large sums any last year she can give �3,000 from last years allowance this year.
So if she dies within 7 years �37,000 or �34, 000 will be added to her savings etc (excluding any left to charity which don't pay inheritance tax). Then the tax man takes 40% of anything over the threshold.
I would agree with Lady Penelope, if you accept this you should be prepared to treat it as a loan, and give it back if she needed it. (If you use it to reduce your mortgage you can increase it again if needed, and save money meanwhile, but if you spend it on an expensive holiday it's gone for ever)
This page gives figures http://news.bbc.co.uk/1/hi/business/3038860.st m
This is your mother's money. Presumably she (and your father) worked hard all their lives to accumulate this capital. This sum comes from her prime residence and is well below the Inheritance Tax level so there should be no tax to pay on it. If you all really have your mother's long term welfare at heart you will encourage her to invest this money in the highest interest savings account she can find in her own name. And you four children will stand on your own two feet so that if your mother's relationship with the boyfriend ends and she finds herself homeless, she will not be left up the creek without a paddle, without a home and not having enough money to buy herself another one. . Probably if she gives money to any of you, it will be spent on something or other and if she finds herself homeless you may all find good reasons why none of you have the space in your houses to offer her a permanent home.
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