Inheritance tax

FORTHCOMING CHANGE: The newly elected Labour government announced on 29 July 2024 that it intends to replace the current (2024–25) domiciled-based assessment of inheritance tax (IHT) with a new residence-based system from 6 April 2025, which would bring non-UK assets within the scope of IHT if the owner has been resident in the UK for ten tax years and keep them within the charge to IHT for between three and nine years after that person ceases to be UK resident. Details of the new rules were published in the Budget on 30 October 2024 (Autumn Budget 2024). See paragraph 5.51 of Autumn Budget 2024 and Technical Note: Reforming the taxation of non-UK domiciled individuals.

FORTHCOMING CHANGE: In the Budget on 30 October 2024 (Autumn Budget 2024), the Chancellor of the Exchequer announced that business property relief (BPR) at the current rate of relief of 100%, which applies to the value of certain types of property, will be limited to the first £1 million of that value and the remainder will receive relief at only 50%. If the taxpayer, or the estate of the taxpayer,

To view the latest version of this document and thousands of others like it, sign-in with LexisNexis or register for a free trial.

Powered by Lexis+®
Latest Private Client News

All in? Court confirms when a settlement is 'made' for the purposes of excluded property (Accuro Trust (Switzerland) SA v The Commissioners for HMRC)

Private Client analysis: This case considered the meaning of 'relevant property' under the settlements regime of the Inheritance Tax Act 1984 (IHTA 1984) and, in particular, the time at which this definition is to be tested. The question arose as to whether the trustees of an offshore trust established by a non-UK domiciled settlor were subject to the UK settlements regime in respect of property added to the trust after the settlor became deemed domiciled in the UK, or whether they were exempt from such charges as the trust consisted solely of excluded property. The First-tier Tribunal (FTT) held that whether trust property is excluded property is based on the status of the trust at the time that it was established, not at the time that the property in question was added to the settlement. As a result, the trust in this case did consist solely of excluded property and no inheritance tax (IHT) charges arose as a result of either the ten-year anniversary or capital distributions. The FTT was also asked to consider whether their jurisdiction was appellate, or supervisory only. The FTT held that, while their jurisdiction was supervisory, the questions raised by the trustees were relevant in establishing whether HMRC had acted reasonably and that the outcome (ie that the paid IHT should be refunded and that no further IHT was due) would be the same in either case. Written by Katherine Willmott, senior associate solicitor at Foot Anstey LLP.

View Private Client by content type :

Popular documents