The tax is calculated as follows (see Key Data ¶8-000):

(1)ascertain the transferor's cumulative total prior to the latest transfer;

(2)add on the latest transfer;

(3)calculate the tax on the total;

(4)subtract the tax payable on the previous total.

Example

C, who has a cumulative total of £250,000, makes a chargeable gift of £90,000 on 1 May 2019.

Tax on the gift

£

£

Previous cumulative total

250,000

Add: chargeable transfer

 90,000

New cumulative total

340,000

     

Tax on £340,000 (2019–20 rates: see ¶8-000):

On first £325,000

Nil

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