Commentary

54 Inheritance tax—interests in possession

CHOSES IN ACTION vol 7
| Commentary

54 Inheritance tax—interests in possession

| Commentary

54 Inheritance tax—interests in possession

It is important to note that the Finance Act 2006 changes1 have not treated an interest in possession as a reversionary interest and hence as excluded property. Instead the position is as follows:

  1. 54.1

        in certain cases the old rules (under which the interest in possession beneficiary is treated as beneficially entitled to the property) continue to apply2;

  2. 54.2

        in other cases, however, the trust will be subject to the relevant property charging regime3 and accordingly:

    1. 54.2.1

          the interest in possession beneficiary will not be deemed to own the settled property; and

    2. 54.2.2

          his interest

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