The common ‘misconception’ about the inheritance tax seven-year rule

Lifetime gifting can be an effective way to reduce the value of your estate and lower an inheritance tax (IHT) bill.Larger gifts that fall outside other allowances, such as the £3,000 per year annual exemption and the £250 small gift allowance, are known as potentially exempt transfers (PETs).How much inheritance tax is owed will depend on when the PETs were made. Under the seven-year rule, if gifts were given at least seven years before death, they won’t be subject to inherita