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CELE SQE1 模拟练习

Examination Timing: 00H00M57S

A man died in December 2023. He made three lifetime gifts only, which were all to his son, to help with the cost of repairs to the son’s house. The gifts were as follows: May 2017: £3,000 July 2018: £4,000 August 2020: £7,000 What is the man’s cumulative total for Inheritance Tax purposes at the date of his death?

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For Inheritance Tax (IHT) purposes, lifetime gifts made within seven years of death may be subject to IHT if they exceed the annual exemption. The annual exemption allows for up to £3,000 of gifts each tax year to be exempt from IHT. If the exemption is not used in one tax year, it can be carried forward to the next tax year, but only for one year. May 2017: £3,000 - This gift is fully covered by the annual exemption for the tax year 2017/18, so it does not count towards the cumulative total. July 2018: £4,000 - The £3,000 annual exemption for the tax year 2018/19 covers part of this gift. The remaining £1,000 is not covered and counts towards the cumulative total. August 2020: £7,000 - The £3,000 annual exemption for the tax year 2020/21 can be applied. The remaining £4,000 is not covered and counts towards the cumulative total. Adding the amounts not covered by the annual exemptions: July 2018: £1,000 August 2020: £4,000 Total cumulative amount for IHT purposes: £1,000 + £4,000 = £5,000 Therefore, the correct cumulative total is £5,000. 


Key Point: When calculating the cumulative total for IHT purposes, apply the annual exemption to each gift. Any amount exceeding the exemption within the relevant tax year counts towards the cumulative total for the seven years before death.

收集问题

为什么2019/2020的免税额3000,不能带到2020/2021?

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Thank you for your question. Here's a detailed explanation:

The annual exemption for Inheritance Tax (IHT) allows individuals to gift up to £3,000 each tax year without it being added to the value of the estate for IHT purposes. If you do not use the full £3,000 exemption in one tax year, you can carry it forward to the next tax year, but only for that one year.

So, applying this to your question:
1. **May 2017:** £3,000 – This gift is fully covered by the annual exemption for the tax year 2017/18.
2. **July 2018:** £4,000 – The £3,000 annual exemption for the tax year 2018/19 covers part of this gift. The remaining £1,000 is not covered and counts towards the cumulative total.
3. **August 2020:** £7,000 – The £3,000 annual exemption for the tax year 2020/21 can be applied. However, the unused portion from the previous year (if any) has already expired.

Now, to address your specific question: The annual exemption for the tax year 2019/2020 cannot be carried forward to 2020/2021 because it's a rule that the exemption can only be carried forward for one year. Once that year has passed without using the exemption, it cannot be carried forward any further.

In short, the tax year's allowance must be applied within that year or at maximum carried forward to the next immediate year. After that, it lapses and cannot be carried over beyond one year.

**Key Points:**
- Use annual exemptions within the relevant tax year.
- Unused exemptions can only be carried forward for one year.
- Post that one-year period, the unused exemption cannot be applied.

I hope this clarifies your question! Keep up the good work and always feel free to ask if you need more help.

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