Research carried out by the Institute for Fiscal Studies (IFS) and the National Centre for Social Research (NCSR) has suggested that only 45% of individuals seeking to gift money are aware of inheritance tax (IHT) rules and exemptions.
According to the IFS, the research aimed to ‘analyse individuals’ awareness of IHT rules and exemptions’. It also ‘explored the prevalence of gifting in the general population and how it varied between different groups’, and considered the ‘nature of gifting’.
The research found that just 25% of so-called ‘gifters’ have a ‘working knowledge’ of IHT rules in relation to gifting. However, many individuals have sought additional information on the rules.
12% stated that they wouldn’t have given a gift had IHT rules or exemptions not been in place. The research suggested that, of those who reported that they were influenced by IHT rules, only 38% said that passing on assets was a purpose of the gift.
Older people are ‘more likely’ to be gifters than young people, according to the data. 24% of individuals aged 70 and over have gifted in the past two years, compared to just 3% of those aged between 18 and 29.