IHT Annual Gifts & Exemptions Calculator
Calculate how much you can give away each year IHT-free using all available exemptions: £3,000 annual, small gifts, wedding gifts, and normal expenditure from income.
Annual IHT Gifts Exemptions Calculator
Multiple IHT exemptions allow you to give away money every year without IHT risk. This calculator combines all available annual exemptions to maximise your tax-free gifts.
Annual Exemption (£3,000/year)
Small Gifts Exemption (£250 per person)
Wedding / Civil Partnership Gifts
Normal Expenditure Out of Income
Amount after all personal expenditure from after-tax income
Frequently Asked Questions
What is the annual IHT gift exemption?
Each person can give away up to £3,000 per tax year completely exempt from IHT. If you did not use the exemption last year, you can carry forward one year's unused allowance, meaning you could give away up to £6,000 in the current year. The exemption cannot be carried forward more than one year.
What is the small gifts exemption?
You can give any number of people up to £250 each per tax year completely free from IHT. The small gifts exemption cannot be combined with the annual exemption for the same person — you cannot give someone £3,250 and claim both.
What are wedding gift exemptions?
On the occasion of a marriage or civil partnership: parents can give up to £5,000 each, grandparents can give up to £2,500 each, and anyone else can give up to £1,000. The gift must be made on or shortly before the wedding and be conditional on the wedding taking place.
Can married couples combine their exemptions?
Yes. Each spouse has their own £3,000 annual exemption, £250 small gifts exemption, and normal expenditure out of income exemption. Combined, a couple can give away £6,000 per year from the annual exemption alone (£12,000 if neither used it last year), plus small gifts and wedding exemptions.
What happens to gifts above the exempt amounts?
Gifts above the exempt amounts are Potentially Exempt Transfers (PETs). If you survive 7 years from making the gift, no IHT is payable. If you die within 7 years, taper relief may apply (reducing the IHT charge from 40% to 8% between years 3-7). Above your nil-rate band (£325,000 + residential NRB if applicable), IHT is due.
Are gifts to charity exempt from IHT?
Yes. Gifts to UK registered charities are completely exempt from IHT — there is no limit and no 7-year rule. If you leave 10% or more of your net estate to charity in your will, your estate also qualifies for the reduced 36% IHT rate (instead of 40%).
Are gifts to a spouse or civil partner exempt?
Yes. Gifts between UK-domiciled spouses and civil partners are completely exempt from IHT — no limit and no 7-year rule. If your spouse/partner is not UK-domiciled, the exempt amount is limited to £325,000 cumulative (though they can elect to be treated as UK-domiciled).
How do I document annual gifts for the executor?
Keep a simple record of: dates, amounts, recipients, and which exemptions used. This makes form IHT403 (gifts declarations) straightforward after death. A simple spreadsheet updated annually is sufficient for most people.