AIBU to think my DM needs to tell the lawyer about this?

[Apolloanddaphne]

I am actually a bit conflicted tbh.

DF died recently and i am going with DM to the solicitor today to go over his will. I know that in 2015 she and my DF gave 5 grandchildren £5000 each. This is way over their joint allowance and DF has not survived the required 7 years for this to be okay.

I have been encouraging her to be up front about this when we go but now i am wondering if we should not say anything. I think she is in a bit of a tizz about it all and doesn't want her GC to have to pay back money. But we don't want her to get into trouble as we are very law abiding citizens.

We need to tell them don't we?

It's also a common misconception that the estate pays IHT on gifts that are chargeable on death. In a roundabout way they do if NRB is used (as it decreases to take into account the gifts therefore more of the Estate is chargeable) but the legislation deems the gift recipient to be liable for the IHT due on death if not exempted via allowances or the nil rate band.

God it is complicated! We will tell the lawyer and keep it all up front. Best all round.

So much information is wrong on here. Taper relief doesn't apply unless you give away more than the nil rate hand (unlikely unless your DM has a LOT of grandchildren ), the £3,000 is per donor not per donee and a joint gift is treated as 50:50.

But the grandchildren will not need to pay anything. The gifts will use a really small amount of your father's nil rate band. That's it.

Nothing to worry about for your mum at all.

@Alarae

I was talking to DD2 about it and I calculated she may be liable for £320 - very close to the sum you quoted. Maybe I understand this better than I thought I did!

Thanks everyone for helping me see that it all needs to be disclosed.

I was under the impression that major gifts were allowed as long as they came out of income?

also it's come from joint money so I would have thought it's 7 years after the second person goes.

The money came from bonds which matured not out of income.

Joint gifts are treated 50:50 between the donors, and you need a pattern of gifting to claim the income exemption.

But if your mum gave that money then none of this applies. Just tell her that that's all she needs to say, and she'll be fine. Not that anyone is even going to notice, though.

Might there be an argument that a bond maturing is income? I mean, savings income is taxed! So it's income.