Inheritance tax

Personal Relief	2013-2014	2012-2013
Free of tax up to	£325,000 *	£325,000
Tax on excess	40% **	40% **
Transfers to certain trusts	20%	20%
Overseas domiciled spouse exemption	£325,000	£55,000
Annual gifts exemption	£3,000	£3,000
Gifts to charities	Exempt	Exempt
Small gifts to same person	£250	£250
Marriage/ civil partnership gifts by:
-Parent	£5,000	£5,000
-Grandparent / party to marriage / civil partnership	£2,500	£2,500
-Other person	£1,000	£1,000

* Frozen at this level until April 2018
** A reduced rate of 36% applies where 10% or more of a net chargeable estate is left to charity.
***Alternatively can elect to be treated as UK domiciled for IHT purposes.

Business Property Relief
A business or interest in a business (including a partnership share)	100%	100%
Transfers of unquoted shareholdings (including AIM shares)	100%	100%
Transfers out of a controlling shareholding in quoted companies, land or buildings, machinery or plant used in qualifying company or partnership	50%	50%

Reduced tax charge on gifts made within the seven years before death
Years before death	0-3	3-4	4-5	5-6	6-7
% of inheritance tax payable	100%	80%	60%	40%	20%