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The Herald Scotland
4 days ago
- Business
- The Herald Scotland
What is the seven year rule in Inheritance Tax for UK?
Not all inheritances happen once you've died. Gifting larger sums of money to loved ones while you're still alive is both a practical and tax-smart way to get money flowing between generations. Some people call this a 'living inheritance', since they're passing on money that would have been inherited – just sooner, rather than later. As long as you're aware of the seven year rule. If you die within seven years of making a substantial gift, the value of the gift will be counted as part of your estate (if not covered by an IHT exemption), and will therefore potentially be liable for IHT if you do not have sufficient nil rate band available on death to protect the gift. These are the essentials you need to know. 1. The seven year gifting rule Two thirds (68%) of UK adults say it's important to them to leave an inheritance, and 65% of retired people plan to pass property or money on. However, changes which will potentially bring more assets into scope for IHT and proposed amendments to the IHT treatment of pensions announced in the Autumn Budget, mean that thousands of taxpayers may find themselves facing a much higher tax bill – and leaving a much lower legacy. As a result, many people are considering gifting money or assets during their lifetime. Under the seven year gifting rule, however, you need to live for seven years from the date of the gift. Otherwise, your beneficiaries may end up returning some of the gift back to HMRC. 2. What counts as a gift? HMRC defines a gift as anything you give away. This includes money, property or land, stocks and shares listed on the London Stock Exchange, household and personal goods, furniture, jewellery or antiques. It also covers unlisted shares if you held them for less than two years before your death. These gifts are called Potentially Exempt Transfers or PETs (unless they fall under an IHT exemption, such as the £3,000 annual exemption). The name sounds more complicated than it actually is. Essentially, your gift is 'potentially exempt' from IHT – an outright gift from one person to another, and you'll only pay IHT on a PET if you do not survive for 7 years from the date of the gift, and the gift is not covered by your available nil rate band on death. A gift over £3,000 could also be considered a Chargeable Lifetime Transfer (CLT). A CLT is most commonly a gift made into a discretionary trust, where you pay the IHT upfront –at 20% on any amount over the Nil Rate Band (currently £325,000 per person). Gifting and IHT can seem complex – it certainly has its fair share of financial jargon. We do strongly advise that you talk to a financial adviser if you're considering a CLT or any kind of Trust, so you can check that it's the right choice for you and your family. Read more: Money HQ | Retirement planning: how to maintain your living standards 3. The 'tapering off' rule The good news is that the rate of IHT on gifts made above the available nil rate band tapers off on a sliding scale. This is known as taper relief; and it ranges from 32% to 8% if you die six years after rule of thumb is, longer you live, the more you'll give. Survive for seven years, and your gift is IHT tax-free. How taper relief works: If you die 3 to 4 years after gifting, the rate of IHT on your gift reduces to 32% If you die 4 to 5 years after gifting, the rate of IHT reduces to 24% If you die 5 to 6 years after gifting, the rate of IHT reduces to 16% If you die 6 to 7 years after gifting, the rate of IHT on your gift to 8%. 4. Can I protect my gift from IHT? If the amount of your gift exceeds you're available nil rate band, you can protect it by taking out a 'gift inter vivos policy'. This is a form of life insurance that protects the recipient from Inheritance Tax (IHT) should you not live for seven years. These policies are designed to mirror the tapering effect of your liability. So that, for example, if you die in year six, it'll pay out the exact amount you'd need. It's a less commonly known insurance, but a financial adviser will be happy to help if you'd like to know more. It is also possible to protect gifts which are made within the available nil rate band using a level term assurance policy, with the term arranged to match the period until the gift falls outside of the estate – this would be 7 years if the gift had just been made. 5. What other gifts can I make tax-free? You can make tax-exempt gifts of up to £3,000 every tax year. Your annual gifting allowance can be split between several people or given in full to one person. When making your first gift, you can roll the gifting allowance from the previous year, so you can gift £6,000. Smaller gifts under £250 are tax free. And any gift to your civil partner or spouse is automatically tax exempt too. Regular gifting each year can steadily reduce the size of your estate, while increasing the financial security and wellbeing of the rest of the family. 6. What's the best age to start making larger gifts? Generosity is good at any age! But building gifting into your long-term plans over several decades means that, statistically, you're less likely to need to worry about the seven year rule. If you're in your early sixties, with children and grandchildren, a substantial gift to help with a house deposit or school fees means you can enjoy seeing the difference it makes while you're still around. Making bigger gifts earlier in your lifetime means you stand a better chance of your gift passing in its entirety to the next generation tax free. 'Gifting between generations keeps money going where it's needed most.' Tony Clark, Senior Propositions Manager, SJP Keeping track of your gifts Keep a written record of each and every gift you make – it could save? your family time, energy and tax. If you can't prove when you made a gift, for example, you may end up paying some IHT whether you like it or not. We're sometimes asked how HMRC actually know what gifts you've made if no record or receipt existed. The short answer is – they don't. However, your executors must sign a legal declaration that all information provided must be full, accurate and truthful when they settle your estate. That includes all gifts made. Keeping a written gifting record, including when you made it, how much it was worth, and who you gave it to will set the record straight. HMRC have a specific form, "IHT403", you can use to record the details of all gifts you make. Planning your gifting In the first chapter of our recent consumer survey, The Real Life Advice Report, over 47% of those in receipt of regular advice said that their adviser had helped them pass money on to loved ones. If you start gifting annual lump sums or regular amounts in good time, you can make a substantial difference to your family's financial wellbeing in the here and now – and their IHT bill in the future. That's an invaluable legacy to leave. Trusts are not regulated by the Financial Conduct Authority. Ben Stark is a chartered financial planner with over a decade of experience advising businesses and families. He is partnered with St. James's Place Wealth Management.
Yahoo
02-04-2025
- Business
- Yahoo
Correction: Marimaca Commences Trading on the Australian Securities Exchange
VANCOUVER, British Columbia, April 02, 2025 (GLOBE NEWSWIRE) -- Marimaca Copper Corp. ('Marimaca' or the 'Company') (TSX: MARI) (ASX: MC2) refers to its announcement dated March 31st, 2025 (ET) / April 1st, 2025 (AEDT) in relation to the commencement of trading on the Australian Securities Exchange ('ASX'). The Company advises that the announcement contained an error and Marimaca is not admitted to the ASX as a 'Foreign Exempt Listing'. The Company was admitted to the official list of the ASX on March 31st 2025 (AEDT) and commenced quotation at 13:00 (1:00pm) (AEDT) on April 2nd 2025. Shares of the Company trade under the ticket MC2 and will be settled in the form of CHESS Depositary Interests ('CDIs'). Each CDI will be equivalent to one fully paid common share of the Company. About Marimaca Copper Corp. Marimaca is a copper exploration and development company focused on its 100%-owned flagship Marimaca Copper Project and surrounding exploration properties located in Antofagasta Region, Chile. The Marimaca Copper Project hosts the Marimaca Oxide Deposit (the 'MOD'), an IOCG-type copper deposit. The Company is currently progressing the Marimaca Copper Project through the Definitive Feasibility Study led by Ausenco Chile Ltda. In parallel, the Company is exploring its extensive land package in the Antofagasta region, including the >15,000ha wholly-owned Sierra de Medina property block, located 25km from the MOD. Contact InformationFor further information please visit or contact: Tavistock +44 (0) 207 920 3150Emily Moss / Ruairi Millarmarimaca@ news release includes certain 'forward-looking statements' under applicable Canadian securities legislation, including, without limitation, anticipated benefits of the ASX listing, expansion into new markets, future financial performance, permitting timelines, development timelines, exploration strategy and financing plans. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Forward-looking statements reflect the beliefs, opinions and projections on the date the statements are made and are based upon a number of assumptions and estimates that, while considered reasonable by Marimaca, are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors, both known and unknown, could cause actual results, performance or achievements to be materially different from the results, performance or achievements that are or may be expressed or implied by such forward-looking statements and the parties have made assumptions and estimates based on or related to many of these factors. Such factors include, without limitation: risks related to share price and market conditions, regulatory changes, access to capital markets, the inherent risks involved in the mining, exploration and development of mineral properties, the uncertainties involved in interpreting drilling results and other geological data, fluctuating metal prices, the possibility of project delays or cost overruns or unanticipated excessive operating costs and expenses, uncertainties related to the necessity of financing, uncertainties relating to regulatory procedure and timing for permitting submissions and reviews, the availability of and costs of financing needed in the future as well as those factors disclosed in the annual information form of the Company dated March 27, 2025 and other filings made by the Company with the Canadian securities regulatory authorities (which may be viewed at There is no assurance that the Company will achieve the anticipated benefits of its ASX listing or successfully execute its strategic initiatives. Readers should not place undue reliance on forward-looking statements. Marimaca undertakes no obligation to update publicly or otherwise revise any forward-looking statements contained herein whether as a result of new information or future events or otherwise, except as may be required by law. Neither the TSX nor the Canadian Investment Regulatory Organization accepts responsibility for the adequacy or accuracy of this in to access your portfolio
