Answers · UK 2025/26
How much can you gift someone without paying inheritance tax in the UK?
You can gift up to £3,000 per year tax-free (annual exemption), plus £250 to any number of individuals, plus wedding gifts of £5,000 (child), £2,500 (grandchild), or £1,000 (others). Regular gifts from surplus income are also exempt with no cash limit.
Full answer
Inheritance tax (IHT) is charged at 40% on estates above the nil rate band, but HMRC provides several gift exemptions that allow you to pass wealth free of IHT during your lifetime. Annual exemption: - You can give away up to £3,000 per tax year free of IHT. - If you did not use the previous year's annual exemption, you can carry it forward one year only -- giving a maximum of £6,000 in one year if the previous year's was unused. - This applies per donor, not per recipient. Small gifts exemption: - You can give up to £250 to as many different individuals as you like in a tax year -- with no IHT. - You cannot use the small gifts exemption on the same person to whom you are also using the annual exemption. Wedding gifts: - £5,000 to your child (or civil partner's child) - £2,500 to a grandchild or great-grandchild - £1,000 to any other person - The gift must be made on or before the wedding day. Regular gifts from surplus income: - Gifts made out of your regular income (not capital) as part of a normal expenditure pattern can be exempt without limit. - You must be able to demonstrate: the gifts were regular, they were made from income (not eating into capital), and you maintained your normal standard of living after making them. - This is powerful for high earners -- regular monthly or annual gifts to children can remove large sums from your estate. The 7-year rule: - Larger gifts (Potentially Exempt Transfers) become fully exempt if you survive 7 years after making them. - If you die within 7 years, taper relief reduces the IHT charge on a sliding scale (only applies if the gift exceeds the NRB). - Gifts to most trusts attract an immediate 20% entry charge above the NRB.
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This answer is informational only and does not constitute financial, tax or legal advice. Figures are for the 2025/26 UK tax year. See our methodology and sources.