Q&As

In order to maximise availability of business property relief from inheritance tax, is it always necessary to leave business assets in the estate by Will to a separate discretionary trust?

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Produced in partnership with Paul Davies of Clarke Willmott
Published on: 09 January 2020
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For information on business property relief generally, see Practice Note: IHT—business property relief.

The Q&A alludes to the advice often given to a testator, to leave assets qualifying for business property relief (BPR) to a discretionary trust by their Will.

The question can be broken down into two parts:

  1. •

    is a specific legacy of the business property required?

  2. •

    does the recipient of the legacy have to be a discretionary trust?

Is a specific legacy required?

A specific legacy of the business property is best if the beneficiaries of the deceased’s entire estate passing by the

Paul Davies
Paul Davies

Clarke Willmott

Paul Davies is a partner in the private client team of Clarke Willmott. He is a solicitor, a chartered tax advisor, and a member of the Society of Trust and Estate Practitioners, as well as being a chartered accountant (albeit no longer practising as such). He specialises in providing advice across the range of different tax and legal issues that face high net worth individuals, executors, and trustees.

Paul's work spans all areas of private client work, including wills, trusts of all kind, inheritance tax, succession planning, probate and estate administration, and lasting powers of attorney.

Paul acts as a professional trustee for a number of family trusts, and is also regularly called on to act as a professional executor.

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Jurisdiction(s):
United Kingdom
Related legal acts:
Key definition:
Inheritance tax definition
What does Inheritance tax mean?

Inheritance Tax is paid on an estate when somebody dies or when trusts or gifts are made during someone's lifetime.

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