Could I give £250 gifts to 400 people who then pay them to my daughters to beat inheritance tax on £100,000?

I am one of the people who will negatively affect Rachel Reeves’ unused pension containers.

Currently, this change will mean additional inheritance tax If I die, don’t blame about £ 270,000 for me.

I look at the gift rules and the amounts you can give each year is £ 3,000 or unlimited £ 250, but only one per person.

However, if I can give it to IHT as many people as much as I want, can I do this, and then can these people give the money to my two daughters?

I mean, can I give a total of 100,000 £ different to a different person, and each one gives £ 250 to my daughters, each one gave £ 50,000 and thus avoids the inheritance tax? RJ, via e -mail

Harvey Dorset, This Money, Answers: Recent changes mean that more people are eligible to participate in the inheritance tax invoices in their property in the coming years.

Pensions will fall to the inheritance tax network as of 2027, that is, many of them will see that their property is far above the inheritance tax allowance.

The inheritance tax receipts recently rose to £ 8.2 billion from April 2024 to March 2025 and more than £ 800 million from the same period a year ago.

One of the main ways to reduce a potential IHT invoice is to make the most of the gift allowances to reduce the value of your property.

However, since the mid -1980s, the existing gift allowances have entered into force with the annual inheritance -free gift limit with £ 3,000.

This made it difficult to significantly reduce the size of a property using this allowance.

In addition to an annual annual allowance to a recipient to a recipient, the rules predict that you can give a gift of 250 pounds to the person you want.

This is your novel solution. If you can find 400 willing participants – something I dare to say that you can have problems – why can’t you give £ 250 to give it to your two daughters?

Unfortunately, as Quilter Cheviot’s tax expert David Denton, as discussed below, you may not be able to find the solution you can even think about.

Fortunately, there are other options to help you put your reserve to your two daughters.

David Denton says you need to consider the option to make gifts from excess income

Quilter Cheviot’s tax expert David Denton, Answers: When the tax burden has recently reached a high level and rumors of more tax increase, it can be understood that consumers may want to find ways to reduce tax bills.

However, tax authorities are rightly opens for people who find that they think that there are new and new ways to avoid the potential to abuse of the system.

Some may be legitimate, but they are likely to cause more problems than the value for the vast majority.

In 2013, the United Kingdom introduced the ‘General Anti -Istisan rule’ (Gaar), and this was designed to target taxpayers who avoid paying taxes, although some aspects are potentially legal.

Malicious arrangements can be included in a number of predetermined steps that HMRC will look at the general impact of the series or the combination of the process to describe the real purpose.

GAAR is valid for a number of personal taxes, including the inheritance tax, so if it is under sufficient tax risk, it can be enacted here, considering that it is a pre -planned element and contains a number of people.

Instead, you should see how they can still use the rules to make important gifts. For example, if you expect to live for more seven years, it may be worth making a gift above the limit of £ 3,000 as a potentially exempt transfer. After seven -year gifts, these beings will no longer be considered about death and will not be free from the inheritance tax.

According to the relationship between the donor and the buyer, there are other possibilities that may be up to £ 5000 for exempt gifts such as marriage gifts.

Finally, there is also the option to make gifts from excess income that the gift is part of your normal expenses and allows you to protect your usual standard of living. These gifts may come from salaries, dividends, retirement income or rent income, so offer you a lot of options within the rules of the UK tax system.