Family maintenance disposition (UK inheritance tax)
Certain lifetime dispositions made for family maintenance, education or training are not transfers of value for inheritance tax if the relevant statutory conditions are met. These include qualifying provision for a spouse or civil partner and specified provision for a child; reasonable care or maintenance of a qualifying dependent relative is also covered. The beneficiary, purpose and period must be checked under the statute. This rule is distinct from the normal expenditure out of income exemption.
Worked example
A parent pays qualifying school fees during the lifetime of their child aged 15. Assuming the disposition satisfies the relevant statutory conditions for the child’s education, it is not a transfer of value for inheritance tax. This conclusion does not automatically apply to every gift to a child.
Common mistake
Treating every gift to a relative as family maintenance, or assuming a qualifying lifetime disposition applies automatically to a gift by will on death.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | TX (UK) | Supporting | June 2026–June 2027 |