As well as your £3,000 annual exemption, you can give as many £250 gifts per person as you want during the tax year, provided you haven’t used another exemption on the same person. If you want to give someone a large lump sum – perhaps you want to help your children with a property deposit, or pay off their student debts for them – it will be exempt from inheritance tax provided you live for a period of seven years after making the gift. The rules say that if you can afford to make regular gifts out of the income you receive (it can’t be out of your savings or other capital), you can give these away without having to pay inheritance tax on them.