Have You Utilised 2022-23 IHT Allowances and Reliefs?

Individuals looking to make the most of their Inheritance Tax (IHT) allowances and reliefs during the 2022-23 tax year, including cash gifts, normal expenditure out of income, and wedding or civil ceremony gifts.

Provides guidance on the limits of tax-free gifts and exemptions, helping individuals avoid unnecessary IHT liability and ensure compliance with HMRC rules. Consulting a tax advisor can ensure all allowances are correctly applied.

Misapplying exemptions or exceeding limits can increase the value of your estate subject to IHT, resulting in higher tax and compliance risk. For personalised guidance, a local accountant can help manage records and claims.

Annual Exemption

You can give away up to £3,000 worth of gifts each tax year. This is known as your annual exemption. Any unused part of the annual exemption can be carried forward, but only for one year. For example, if you didn’t make any cash gifts in 2021-22, you could gift up to £6,000 in 2022-23.

Exemptions for Normal Expenditure Out of Income

There are also exemptions for normal gifts made out of your income, but you must maintain your standard of living after making the gift. 

Wedding or Civil Ceremony Gifts

• Gifts up to £1,000 per person
• Higher limits of £2,500 for a grandchild or great-grandchild
• £5,000 for a child

Small Gifts Exemption

You can also give as many small gifts of up to £250 per person as you want during the tax year, provided you have not used another exemption on the same person.

Gifts to Spouse or Civil Partner

Lifetime gifts between spouses or civil partners are exempt from IHT as long as both live permanently in the UK.

Other Gifts

Any gifts outside these limits count towards the value of your estate and should be carefully considered for IHT planning purposes. Seeking guidance from a tax advisor can ensure your gifts are structured efficiently.

Make the Most of 2022–23 IHT Allowances and Reliefs with Cigma Accounting

Ensuring that all available Inheritance Tax allowances and reliefs are fully utilised can significantly reduce the tax payable on your estate. Missing opportunities or miscalculating entitlements may result in unnecessary liabilities. At Cigma Accounting, we support individuals and families across Farringdon, Blackfriars, and St Paul’s in reviewing and applying IHT allowances effectively with guidance from a trusted tax accountant in London.

Whether you are assessing unused nil rate bands, residence reliefs, or lifetime gifts, professional advice ensures you maximise all available reliefs while remaining compliant. Cigma Accounting provides tailored inheritance tax planning London to help clients protect wealth and minimise IHT exposure, with physical offices across London.