3 Reasons why you need Gift Inter Vivos Life Insurance!

How Can Gift Inter Vivos Life Insurance Help?

Under the inheritance tax rules no tax is immediately due when an gift is made during a donors life. However tax does become due if the donor dies within 7 years of the gift being made. The amount of tax is scaled down from the 4th year onwards.

The cover on a gift inter vivos term insurance is designed to provide a lump sum amount sufficient to pay the IHT due when a donor dies within 7 years of making a gift.

To achieve this the sum assured is set at the start of the policy to the amount of inheritance tax that would be due. It remains that level for 3 years and then reduces to 80% in the fourth year, 60% in the fifth year, 40% in the sixth year, and 20% in the seventh year.

The gift inter vivos life insurance therefore has term of 7 years and is a form of decreasing term life insurance. After the 7th year cover ceases at which point liability for IHT also ceases.

Gift -Inter-Vivos life insurance is a special kind of cover and to arrange it speak to a financial adviser. To find out more fill in the form below: