I4.229 Spouse exemption—examples
Spouse exemption: examples 1 to 4.
Example 1 — gift more than 7 years before death (1)
In May 2013 a husband, domiciled in England and Wales, gave to his wife (domiciled in California) a gift of £200,000.
This uses up £200,000 of the spouse exemption.
In June 2020 (more than seven years later) H died, leaving the whole of his estate (£1m) to W (who remained non UK domiciled).
There is now only £125,000 spouse exemption remaining (together with his nil rate band). It is not possible to have the first gift treated as a failed PET which has escaped charge.
Example 2 — gift more than 7 years