Giving money to a uni student tax "efficiently"?

[Collectingbrass]

My daughter is starting at university this September and I want to pay an allowance to her while she is there - ostensibly for driving lessons but probably will go on , & but we were all young once. What is the most tax efficient way to do this?

When I was a lad my Dad paid his parental top up to the grant net of tax and I reclaimed it using (if I remember properly) http://www.hmrc.gov.uk/forms/r185cert.pdf

Can I do this now, and if so as a top rate tax payer what rate do I deduct from the gifted amount? Also I am divorced from her mum (the original SWT) and not the parent with care, does this make any difference

[anonymous-user]

give it to her

live for 7 years

no tax for anyone

[996c2]

I don't think you can give your daughter your gross earnings free of tax in the same way that you can give your gross earning to a charity (e.g. Oxfam) if that is what you mean.

[Eric Mc]

Just give her whatever money she needs. If it's under £3,000 per year, there are no tax issues whatsoever.

If the amount is over £3,000, you could have Inheritance Tax issues IF you died within 7 years of making the "gift" AND your personal estate" is over the IHT thresholds.

[ellroy]

If it from your income, a regular payment and paying it does not affect your standard of living you can give her as much as as you want without limit with no impact on your tax situation as it is an exempt gift for IHT.

Giving money to her will only impact her tax if she keeps it somewhere that generates a return in her hands. E.g. She invests it rather than spends it.

I would suggest looking at any impact that a parental gift, or support, could have on the rights to any grants or loan, however. That I'm not sure of.