Q&As

Where a Will leaves the residuary estate in unequal shares to a charity qualifying for the inheritance tax charity exemption and a non-exempt beneficiary and there is no clear wording as to whether the Re Benham or Re Ratcliffe approach should be taken, is there a default position?

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Produced in partnership with Lynne Counsell of 9 Stone Buildings
Published on LexisPSL on 26/03/2018

The following Private Client Q&A produced in partnership with Lynne Counsell of 9 Stone Buildings provides comprehensive and up to date legal information covering:

  • Where a Will leaves the residuary estate in unequal shares to a charity qualifying for the inheritance tax charity exemption and a non-exempt beneficiary and there is no clear wording as to whether the Re Benham or Re Ratcliffe approach should be taken, is there a default position?
  • The possible approaches
  • Re Benham and Re Ratcliffe
  • Summary

Where a Will leaves the residuary estate in unequal shares to a charity qualifying for the inheritance tax charity exemption and a non-exempt beneficiary and there is no clear wording as to whether the Re Benham or Re Ratcliffe approach should be taken, is there a default position?

The issue was first considered by the court in the much criticised decision of Re Benham’s Will Trusts and reconsidered in Re Ratcliffe, Holmes v McMullen.

The specific question relates to the situation where a Will leaves the residuary estate in unequal shares to a charity qualifying for the inheritance tax (IHT) charity exemption (under section 23 of the Inheritance Tax Act 1984 (IHTA 1984)) and a non-exempt beneficiary. The question is when there is no clear wording as to whether the Re Benham or Re Ratcliffe approach should be taken is there a default position?

The exempt beneficiaries in these cases were charities but the principles apply where part of the residue goes to a spouse or civil partner or to any combination of exempt and chargeable beneficiaries (HMRC Manuals: IHTM26171).

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