As more and more couples are deciding to live together before getting married, they now tend to request gifts of cash rather than the traditional gifts such as kettles and china tea cups.
This is why guests should take advantage of the tax relief available on their gifts to the bride and groom. All or part of the gift will be exempt from Inheritance Tax (IHT) provided that the gift is given shortly before the date of the wedding or civil partnership ceremony.
The amount of tax relief will vary depending on the relationship between the donor and the recipient. The following can give up to:
- £5,000 tax free – Parents or Step-parents
- £2,500 tax free – Grandparents
- £1,000 tax free – Any other person including relatives and friends
If the couple also decide to give each other gifts, the gift will then be entirely free form Inheritance Tax (IHT) and Capital Gains Tax (CGT).