Before You Help Your Kids With Money

Most UK families who help their adult children with money do it inefficiently — and most never realise.

The £20,000 deposit toward the grandchildren's house. The £40,000 toward the daughter's wedding. The school fees for the grandchildren. The annual transfers to help cover the increase in interest rates. Each one is a gift, each one starts a seven-year clock for Inheritance Tax, and most families never document any of it. When the second parent dies, decades later, the executor finds out the gifts were tracked at HMRC — and the IHT bill comes in tens of thousands of pounds higher than it needed to be.

The rules are not complicated. The seven-year rule is a single page of explanation, properly written. The £3,000 annual exemption is straightforward. The wedding-gift and small-gifts exemptions stack neatly on top. And there is one specific exemption in UK law — gifts out of normal expenditure from income — that has no upper limit at all, if you meet the conditions and document it correctly. I've seen it shelter half a million pounds in a single decade of giving, with zero Inheritance Tax. Almost nobody knows about it.

This guide is the playbook. The seven-year rule, the exemptions, the documentation, the Junior ISAs and Junior SIPPs, the trust options, the Deeds of Variation, and the divorce-and-remarriage risks. Everything ordinary UK families need to know about giving money to the next generation, the right way.

— Gerald

What's inside the guide

Forty-two pages. The longest individual guide in the library, because the territory is the biggest.

Part One — The seven-year rule

The seven-year rule, properly explained — including what taper relief actually does and doesn't do
The annual exemptions stack: the £3,000 yearly exemption, the £250 small-gifts exemption, the wedding-gift exemption
Gifts out of normal expenditure from income — the exemption with no upper limit, and the documentation that makes it stick

Part Two — Common gifts and how to make them properly

House deposits and the parent-as-co-signer trap
School fees and university fees — the gift-from-income route
Annual transfers to adult children and grandchildren
Wedding gifts and civil partnership gifts — the specific exemption that matters

Part Three — Vehicles for younger generations

Junior ISAs — £9,000 a year, locked till 18, when it works and when it doesn't
Junior SIPPs — £2,880 a year, when it makes sense for grandparents to fund retirement decades early
Bare trusts vs discretionary trusts — the structural choice for grandparents who want to provide for grandchildren they may not live to see grow up

Part Four — Estate-level planning

Deeds of Variation — the two-year window after a death to restructure inheritance for the next generation, with the surviving spouse's consent
Care fee deprivation rules — the test councils apply when gifts were made shortly before care became necessary
Divorce and remarriage risk — how to protect gifts to adult children against their future relationships

Each chapter includes worked examples, a documentation template, and the specific HMRC reference for the rule.

Who this guide is for

This guide is for you if:

You have one or more adult children, and you've helped them with money — or you're planning to
You have grandchildren, and you want to provide for them in tax-efficient ways
You're worried about Inheritance Tax, and you've heard about the seven-year rule but never had it properly explained
You're a higher-net-worth household (£500K+ in non-pension assets) and the IHT planning matters

This guide isn't for you if:

You don't have children or grandchildren
Your estate is well below the IHT thresholds (under £325,000 single, £650,000 as a couple) and unlikely ever to be IHT-relevant
You already have a full estate-planning solicitor managing all of this — though some readers in this category still buy the guide to understand what their solicitor is doing

Who Gerald is

Gerald Whitlock is a retired British tax accountant who spent nearly four decades inside the UK tax system, in private practice across London and the Home Counties. He retired from full-time practice in 2022. Since then, he has volunteered for Pension Wise and Citizens Advice — sitting opposite over a thousand ordinary UK pensioners trying to make sense of their own paperwork.

He launched the channel and this library because he kept hearing the same stories — pensioners overpaying tax, missing allowances, leaving thousands of pounds with HMRC and the DWP because nobody had ever explained the rules.

Gerald is not a regulated financial adviser, and the guides are not personal financial advice. They are general educational information about UK tax, pensions, and procedures — verified against gov.uk for the 2026/27 UK tax year.

The honest bit

A few honest notes.

This is the guide in the library where the stakes are highest and the gap between "ordinary family who muddles through" and "family with the paperwork done properly" is the largest. The difference can be £140,000 of IHT or more, on what would otherwise be an ordinary family estate.

That said — Inheritance Tax planning is the area where you most need a qualified professional involved before any significant decisions. This guide is the field manual that tells you what to discuss with your accountant or estate planner, what the structural options look like, and what to push back on if the advice you're getting doesn't feel right. It is not a replacement for that professional.

The "gifts out of normal expenditure from income" exemption in particular is one where the documentation matters enormously. HMRC's challenge rate on this exemption rose sharply after the 2026 Hosking case, and the documentation requirements are now stricter than they used to be. The guide covers what HMRC will look for if they challenge — but the actual implementation in a specific family's case should be reviewed by a qualified estate-planning specialist.

This is general information, not personal advice.

— Gerald

Before you check out — one thing worth knowing

This guide is one of six in Gerald's complete library — Everything Gerald Knows. The library covers the rest:

The HMRC letters every UK pensioner will receive — and how to read them
Capital Gains Tax, care fees, and the rules around the family home
The financial reclaims a widow or widower has to make in the first year
Lifetime gifts to adult children — without HMRC taking 40%
Inheritance Tax planning beyond the £1,000,000 shelter most couples have automatically
The handover pack your spouse, children, and executor will actually need

Bought individually, the four sold-separately guides come to £800. The two library-only guides — Before HMRC Takes 40% and Before You're Gone — bring the full value to £1,322.

The complete library is £297.

Most pensioners reading this guide will recognise at least three of the six worries above. At three, the bundle is the better purchase. The maths is straightforward.

Get this guide — £225 Get the complete library — £297

Instant PDF delivery. Lifetime access.

Common questions

Is this regulated tax advice?

No. It's general educational information about UK tax law and IHT planning — the same category of content you'd find in a serious tax-planning book or in MoneyHelper's IHT pages, but pulled together as a practical playbook. For your specific family's situation, the next conversation is with a qualified accountant or estate-planning specialist. The guide tells you what to ask.

Will it work for someone with a very large estate?

The guide is written for ordinary UK families. If your estate is above £5 million, the structural options open to you (FICs, EBTs, complex trust arrangements) go beyond what's covered here. A specialist firm is the right next step, but the guide will still help you understand what they're proposing.

Are the figures current?

Yes. Verified against gov.uk for the 2026/27 UK tax year. The 2026 Business Property Relief changes and the April 2027 pension IHT inclusion are addressed in the relevant bundle-only guide (Before HMRC Takes 40%) — this guide focuses on lifetime gifts.

Does it cover Scotland?

Yes. Scottish-specific notes are included, particularly around legal rights and the differences in succession law. The IHT rules themselves are UK-wide.

What's the refund policy?

14 days, no questions asked. Email the refund address in the PDF and you'll get your £225 back.