Hello,
I have a deceased client who had surplus income in the range of £20,000 - 28,000 every year. They typically only made gifts of around £5,000.
In 2018, he made gifts of £18,000 to each of his three children, which exceeds the amount he had available. Can the amount be deducted from his surplus income in the following years? Does anyone have any experience of successfully claiming this?
Hi Mia,
No, you cant apply future income to the gift, but if there was surplus income in preceding years then it retains its nature as income for a while (usually 2 years) then it may be possible to apply this to the later gifts.
You do need to take care however to be able to show the pattern of gifting by the deceased. For normal gifting out of surplus income you generally need to show that the gifts formed part of pattern of gifting or were intended to be the first in such a pattern of gifting. HMRC manual IHTM14242 clearly says that you cannot include " any gift clearly made for some special purpose."