IHT question

[Office_Monkey]

Hi knowledgeable people of PH. Am due to get married next year, and my dad has asked me to find out about IHT implications if he were to pay for part of this and the worst should happen in the following 7 years.

Would there be any tax due if he were to pay the venue directly, HMRC website states that a £5k gift can be made but would this count as a gift?

TIA

[Eric Mc]

Gifts from a parent to a child, up to £5,000, in anticipation of marriage are completely exempt from IHT.

[Office_Monkey]

Thanks Eric. Would paying the venue directly not have any bearing as in the eyes of HMRC this would still be classed as a gift?

[Eric Mc]

Yes - that's a gift.

[pacoryan]

If the venue contracted with the parent to provide a room for a function would they still consider it a gift? Sounds like a weding tax to me!

Eric. if I paid for my parent's golden wedding anniversary lunch for 100 family and friends at a local hotel including accommodation for them, is that a gift to my parents?

[Eric Mc]

I'd say it is.

Small gifts and gifts out of income are also exempt.

[ellroy]

Not one to pick a fight with Eric, but gifts from income are only exempt if they are regular, and do not affect your standard of living.

[Eric Mc]

ellroy said:

Not one to pick a fight with Eric, but gifts from income are only exempt if they are regular, and do not affect your standard of living.

Of course. You want detail - here's my bill

[Office_Monkey]

I appreciate you taking the time to answer Eric, especially this time of year. Will let my dad know - he'll have to find some other way of reducing the tax bill.