Glossary - Potentially exempt transfer
Description
A Potentially Exempt Transfer (PET) is a lifetime gift of cash, property, or other assets that escapes UK Inheritance Tax if the donor survives seven years. If the donor dies within seven years, the gift is counted back into their estate for IHT, though taper relief may reduce the tax due after three years.
Alternate Names
- PETs
- Tax-exempt lifetime transfers
- Lifetime gifts
- 7-year gifts
- Potentially exempt inheritance transfers
