A third of millennial homeowners received financial help from their grandparents, with an average gifted sum of £7,400, according to a survey from mortgage brokers Trussle.

Meanwhile, research by equity release provider Key found that 15% of grandparents had contributed towards their grandchildren’s higher education, with another 20% planning to over the next decade.

For the younger generation, such gifts can help them reduce debt and qualify for a mortgage. But there may also be tax advantages for grandparents.

If you have more substantial assets you may wish to mitigate your future inheritance tax (IHT) bills. This 40% tax is levied on estates worth more than £325,000, although married couples (and civil partners) can pass on £325,000 each, tax free, with additional allowances for the family home.

After the rapid increase in property values in recent decades, many families may be looking to reduce any potential IHT liability. Giving away assets to family members while you are still living can be an effective way to do this.

There are various rules to consider. The simplest option is to make gifts from regular income, or to limit them to a maximum of £3,000 a year per donor. These will basically be disregarded by HMRC when it comes to calculating future IHT. If you are thinking of giving away larger amounts, you’ll have to live for a further seven years for your gifts to escape the IHT net.

Before you make any substantial gifts, make sure that your own financial future is secure; you may need more in later life. Estate and IHT planning can be complicated, so it is best to seek specialist advice.