In UK tax rules, can I carry any unused annual exemption forward?
Yes, if you don't use the full £3,000 tax free allowance in one tax year, you can carry it over to the next tax year only, giving you a total tax-free gift allowance of up to £6,000.
Do all gifts made before my death count towards the estate for inheritance tax?
Most gifts made during your lifetime count towards the value of your estate if they're made within seven years of your death. However, some gifts are considered out of your estate immediately.
How does taper relief work?
Taper relief can reduce how much inheritance tax is paid on gifts given between three and seven years before the giver's death, on a sliding scale.
This relief does not apply to gifts that fall within the £325,000 nil-rate band.
Years between gift and death Rate of tax on the gift
3 to 4 years 32%
4 to 5 years 24%
5 to 6 years 16%
6 to 7 years 8%
7 or more 0%
Are there any gifts that are always tax-free?
Yes, gifts between spouses or civil partners domiciled in the UK, gifts to charities and political parties, and gifts out of your income that don’t affect your standard of living are always tax-free.
