Lifetime transfers

In this lesson

1. 0:00 Lifetime transfers and exemptions overview
2. 1:03 Potentially exempt transfers explained
3. 1:37 Chargeable lifetime transfers and CLTs
4. 2:02 Exempt transfers for lifetime gifts
5. 3:31 Annual exemption and application order
6. 4:23 Normal expenditure exemption rules

About this lesson

You'll discover the three main types of lifetime transfers (potentially exempt transfers, chargeable lifetime transfers, and exempt transfers), understand which exemptions apply and in what order, and learn how to calculate the actual tax charge or relief available. This knowledge directly supports your ability to handle the transfer of value calculations and exemption rules that appear regularly in exam scenarios. The video walks you through the core exemptions you need to recognise: gifts to spouses and civil partners, small gifts up to £250 per recipient per year, marriage gifts (with specific limits depending on who's giving), and the annual exemption of £3,000. You'll also explore the important concept of normal expenditure out of income—gifts that carry no IHT implications provided they're regular, habitual, and don't reduce the donor's standard of living. Understanding when and how to apply these exemptions in the correct order is essential for accurately determining whether a lifetime gift is truly chargeable or wholly exempt.

Duration: 6m