The "Bank of Mum and Dad" is shorthand for the money families pass down to help younger relatives, most often towards a first home. Official data shows this gifting is common among younger adults but recorded less widely than the headline billions suggest, and it can interact with Inheritance Tax.
This piece pulls together figures from the Office for National Statistics (ONS) and HM Revenue and Customs (HMRC), with clearly-labelled industry research as secondary context. Tax figures are current as at July 2026 and are subject to change. Statistics carry their reference period at each point of use, and older survey data is subject to revision.
Key figures at a glance
Recorded family gifting concentrates among younger adults: the ONS found that around 6% of adults received a cash gift or loan of £500 or more over two years, rising to 11% among 25 to 34 year-olds (ONS, July 2014 to June 2016). The table below gathers the main verified figures with their sources and periods.
| Statistic | Figure | Source and period |
|---|---|---|
| First-time buyers using family gifts or loans for a deposit | 29% (2015-16), up from 22% (1995-96) | English Housing Survey, via ONS, published Oct 2018 |
| Adults receiving a cash gift or loan of £500+ over two years | 6% | ONS, July 2014 to June 2016 |
| Age group most likely to receive a gift or loan | 25 to 34, at 11% | ONS, July 2014 to June 2016 |
| Median value received (all adults / 25 to 34) | £2,000 / £2,500 | ONS, July 2014 to June 2016 |
| Estates paying Inheritance Tax | 31,500 (4.62% of UK deaths) | HMRC IHT liabilities statistics, tax year 2022-23 (published Jul 2025) |
| Inheritance Tax receipts | £8.2 billion | HMRC receipts bulletin, financial year 2024-25 |
| Annual gift exemption for Inheritance Tax | £3,000 per tax year | gov.uk/inheritance-tax/gifts, as at July 2026, subject to change |
Secondary context: Legal & General and Cebr research reported that around one in two first-time buyers under 35 received family support in 2020 (Legal & General / Cebr, 2020). Industry surveys use different methods to official statistics and are not directly comparable.
How many families use the Bank of Mum and Dad?
Family gifting is common among younger adults but a minority activity across the whole population. The ONS found 6% of adults received a cash gift or loan of £500 or more over two years, peaking at 11% for 25 to 34 year-olds (ONS, July 2014 to June 2016). Among older people, receipt was far rarer, at around 1% for those aged 65 and over.
| Age group | Received a gift or loan of £500+ | Source and period |
|---|---|---|
| 16 to 24 | 6% | ONS, Jul 2014-Jun 2016 |
| 25 to 34 | 11% | ONS, Jul 2014-Jun 2016 |
| 65 and over | 1% | ONS, Jul 2014-Jun 2016 |
| All adults | 6% | ONS, Jul 2014-Jun 2016 |
For house deposits specifically, official housing data shows the share of first-time buyers drawing on family gifts or loans rose over two decades, from 22% in 1995 to 1996 to 29% in 2015 to 2016 (English Housing Survey data reported by the ONS, published 30 October 2018). Industry research tends to report higher figures for younger buyers, which reflects both a narrower age group and different survey methods.
How much do parents give?
Typical recorded gifts are modest, though a minority are large. The ONS reported a median of £2,000 for adults who received a cash gift or loan, rising to £2,500 for 25 to 34 year-olds (ONS, July 2014 to June 2016). Averages sit higher than medians because a small number of very large gifts pull the mean upwards.
The ONS also found that people with the most income and wealth tended to receive the largest gifts and loans, so support is not spread evenly (ONS, July 2014 to June 2016). Industry estimates of average deposit help run much higher, but they focus on home buyers rather than the whole adult population. As secondary context, Legal & General and Cebr reported average lending of around £19,000 to first-time buyers under 35 in 2020 (Legal & General / Cebr, 2020), which is not directly comparable to the ONS survey.
Gifting and Inheritance Tax: the rules in numbers
Most lifetime gifts are free of Inheritance Tax if the person giving survives seven years, and several exemptions can apply immediately. You can give away up to £3,000 in total each tax year under the annual exemption, plus unlimited small gifts of up to £250 per person, and larger wedding gifts within set limits (gov.uk, as at July 2026, subject to change).
| Exemption or rule | Amount / effect | Source |
|---|---|---|
| Annual exemption | £3,000 of gifts per tax year | gov.uk, Jul 2026, subject to change |
| Small gifts | Up to £250 per person, per tax year | gov.uk, Jul 2026, subject to change |
| Wedding gift to a child | Up to £5,000 | gov.uk, Jul 2026, subject to change |
| Wedding gift to a grandchild or great-grandchild | Up to £2,500 | gov.uk, Jul 2026, subject to change |
| Wedding gift to anyone else | Up to £1,000 | gov.uk, Jul 2026, subject to change |
| Seven-year rule | No IHT on a gift if you live 7 years after it | gov.uk, Jul 2026, subject to change |
Where the total of gifts made in the seven years before death is above the £325,000 tax-free threshold, taper relief can reduce the tax on the excess on a sliding scale: 32% of the full charge for gifts made three to four years before death, then 24%, 16% and 8% in the later years, reaching nil at seven years (gov.uk, as at July 2026, subject to change). Taper reduces tax on the gift, not the gift itself. The standard Inheritance Tax rate is 40%, charged only above the available thresholds (gov.uk, as at July 2026, subject to change). For a fuller picture, see our guide to lifetime gifts and IHT.
What the numbers mean
The gap between official data and headline figures is the standout point: the ONS records recorded gifting as a minority activity concentrated among younger adults, while industry research reports much larger totals for home buyers alone. Both can be broadly right, because they measure different groups over different periods and by different methods. In our view, that gap is a reason to treat any single "Bank of Mum and Dad" number with care.
For families, a few patterns tend to matter. Gifting clusters at the point of buying a home, which is also when amounts are largest, so parents and grandparents often give when their own retirement is not far off. Because gifts can interact with Inheritance Tax through the seven-year rule and the available exemptions, some people choose to keep simple records of what they give and when, and many find it can be worth discussing larger gifts with a qualified professional before making them.
Family gifting is common among younger adults, but the official record is more modest, and more uneven, than the billion-pound headlines imply.
There is a separate point for anyone thinking about later-life care. If someone gives assets away and later needs care, a local authority financial assessment can look at whether the gift was made deliberately to reduce what they might pay towards care, under the deprivation of assets rules (Care and support statutory guidance, gov.uk, as at July 2026, subject to change). Gifting is not a way to deliberately avoid care fees, and doing so can be challenged. Care fees planning is about limiting and mitigating the impact of care costs within the rules, and it is an area where many people choose to take specialist advice.
Sources and methodology
Every statistic here is drawn from a named official source and verified before publication, with reputable industry research used only as clearly-attributed secondary context. Older survey data is the latest of its kind and is subject to revision.
- ONS, Intergenerational transfers: the distribution of inheritances, gifts and loans, Great Britain, data July 2014 to June 2016, published 30 October 2018 (ons.gov.uk). Includes the English Housing Survey deposit figures.
- HMRC, Inheritance Tax liabilities statistics: commentary, tax year 2022-23, published 31 July 2025 (gov.uk).
- HMRC, tax receipts and National Insurance contributions for the UK (annual bulletin), Inheritance Tax receipts, financial year 2024-25 (gov.uk).
- gov.uk, Inheritance Tax: gifts and thresholds, as at July 2026, subject to change (gov.uk/inheritance-tax/gifts, gov.uk/inheritance-tax).
- Secondary: Legal & General and Cebr, Bank of Mum and Dad research, 2020 (legalandgeneral.com). Method differs from official statistics; not directly comparable.
Gifting in Scotland and Northern Ireland
Inheritance Tax and its gift rules are UK-wide, so the seven-year rule, the £3,000 annual exemption and the £325,000 threshold apply across all four nations (gov.uk, as at July 2026, subject to change). What differs is the surrounding law. Scotland has its own succession rules, including legal rights for a spouse and children, and its own approach to care charging, while Northern Ireland has a separate but broadly similar system to England and Wales. Where an estate touches more than one nation, it can be worth taking advice in each.
Frequently asked questions
How common is the Bank of Mum and Dad in the UK?
Official data suggests family gifting is common among younger adults rather than universal. The ONS found around 6% of adults received a cash gift or loan of £500 or more over two years, rising to 11% for 25 to 34 year-olds (ONS, July 2014 to June 2016). Industry surveys often report higher figures for home buyers specifically.
How much can parents give tax free in the UK?
Each person can give away up to £3,000 in total each tax year under the annual exemption, plus unlimited small gifts of up to £250 per person, and wedding gifts within set limits (gov.uk, as at July 2026, subject to change). Larger gifts can also be free of Inheritance Tax if the giver survives seven years. The right approach depends on your circumstances.
Do gifts from parents count for Inheritance Tax?
They can. Many gifts are potentially exempt transfers, which generally fall out of account if the giver survives seven years, and otherwise count towards the estate (gov.uk, as at July 2026, subject to change). Exemptions such as the £3,000 annual allowance can reduce what counts. Because the rules are detailed, many people choose to take advice on larger gifts.
What is taper relief on gifts?
Taper relief can reduce the Inheritance Tax due on a gift made three to seven years before death, but only where total gifts in that period exceed the £325,000 threshold. The relief runs from 32% of the full charge at three to four years down to 8% at six to seven years (gov.uk, as at July 2026, subject to change). It reduces the tax, not the value of the gift.
Can giving money away avoid care fees?
No, not deliberately. If someone gives assets away and later needs care, a local authority can consider whether the gift was made to reduce care charges under the deprivation of assets rules, and can treat the money as still held (gov.uk, as at July 2026, subject to change). Care fees planning focuses on limiting the impact of care costs within the rules, and it can be worth taking specialist advice.
Why do official gifting figures differ from headline numbers?
They measure different things. The ONS survey covers all adults over a set period and records cash gifts and loans of £500 or more (ONS, July 2014 to June 2016). Industry research such as Legal & General's often focuses on home buyers in a single year, which produces larger averages and totals. Neither is wrong; they are simply not directly comparable.