Key facts
- Martin Lewis explained a rule regarding Inheritance Tax.
- Individuals can leave an unlimited amount of money to family.
- The gift must be made more than seven years before the donor's death to be tax-free.
Consumer finance expert Martin Lewis has outlined a method for individuals to legally avoid Inheritance Tax (IHT) charges. According to Lewis, people can gift an unlimited amount of money to their family members, provided they outlive the donor by a period of seven years. This rule is a key aspect of UK tax law concerning gifts made during one's lifetime. If the donor survives for seven years after making a gift, it generally falls outside of their estate for IHT purposes. However, if the donor dies within seven years, the gift may still be subject to IHT, potentially with taper relief depending on when within the seven-year period the death occurs. Lewis's explanation aims to clarify this often complex area of financial planning for his audience.