Unbanked gifts prior to death

A question about : Unbanked gifts prior to death

OK, enthused by the fantastic response to my first query in here...

My Dad was in the habit in the last few years of giving my sister and I Ј1500 each every Christmas, alongside some smaller gifts for our children's savings accounts. He died just before Christmas, but had already written all the cheques and cards out, dated two days before his death. Can't bank them, accounts already frozen. Can I deal with them as a debt of the estate (thus reducing the IHT liability on it)?

Thanks!

Best answers:

• Yes. Remember you need to account for gifts during the seven years before the death as "potentially exempt transfers". HMR&C website gives details of the allowances.
• Good - thanks. He knew the limits for PETs, that why it was always Ј1500 :-)
• You mention elsewhere that he had a decent pension and wasn't spending it all, so potentially these also come under the 'gifts from unspent income' exemption.
• Actually, having not got the point of beginning to think about the IHT400 and reading through the guidance, I find they absolutely can't be dealt with as debts of the estate. From the IHT400 notes:
  "Uncleared cheques
  If you include cheques written by the deceased, but which had not cleared before they died, please say who the cheques were written out to and for what goods or services. Uncleared cheques that were written by the deceased as gifts cannot be deducted as liabilities of the estate."