All gifts between husband and wife are exempt from inheritance tax (IHT) as long as they are both domiciled in the UK. This means that even if a husband has an estate valued at (say) £10 million, he can gift this to his wife. It does not matter if it was gifted during his lifetime or at the time of his death; either way, his wife will incur no IHT liability. My question is on above point, as from a Muslim background: if someone has more than one wife, how the above gifting will work? Bear in mind, four wives are allowed at a time.  

Arthur Weller replies:  

If you look at HMRC’s Inheritance Tax manual (link here), it states: 'Spouses (to whom the exemption applies) include … •parties to a valid polygamous marriage. The marriage confers the IHTA84/S18 exemption on all transfers to all the spouses of the transferor or deceased who qualify under IHTA84/S18.' However, it also states: 'The following are not spouses (to whom the exemption applies)... •parties to a bigamous marriage.' I presume the difference between the two scenarios is that in the first case the husband and wives are legally married, and in the second case they are not.