Polyolefins such as polyethylene undergo slow degradation when placed in air. Degradation occurs by reactions with atmospheric oxygen that lead to the formation of carbonyl groups (groups containing oxygen), gradual….
Reema gave one of her two nieces £250,000 in February 2003 and the other £250,000 in March 2004.
Reema gave one of her two nieces £250,000 in February 2003 and the other £250,000 in March 2004. There was no tax on the gifts at the time they were made because they counted as PETs. Apart from using her £3,000 a year exemption, Reema made no other lifetime gifts. Reema died in June 2009 which was less than seven years after making the gifts, so they were reclassified as taxable gifts. Reema’s seven-year running total up to and including the February 2003 gift was just £250,000. This falls comfortably within the £325,000 nil-rate band that applies in the year she died. Her running total up to and including the March 2004 gift was £250,000 + £250,000 = £500,000. This means £500,000 – £325,000 = £175,000 of the gift to her second niece falls within the taxable band and tax is initially worked out as 40% × £175,000 = £70,000. However Reema died more than five complete years after making the gift, so the tax bill is reduced by 60 per cent, reducing the tax bill to £28,000. The niece is asked to pay this but, if she can’t, Reema’s estate will.