Commentary

I10.231 Pecuniary legacies

IHT, trusts and estates

I10.231 Pecuniary legacies

Pecuniary legacies and annuities

I10.231 Pecuniary legacies

Pecuniary legacies generally

Subject to any contrary testamentary intention, where pecuniary legacies are payable out of free estate in the UK they are paid free of IHT unless the categories of property liable to pay pecuniary legacies have been exhausted, in which case it is necessary to resort to the legacies fund1.

If pecuniary legacies are payable out of free foreign estate they must bear their own IHT.

If legacies are to be paid out of a mixed fund of UK and foreign estate they will be payable rateably out of the two types of estate (see I10.217), and to the extent they are payable out of the foreign estate they must bear their due proportion of IHT2.

This means that where there is a gift by Will of property (such as foreign property) which would usually bear its own IHT (see I10.203A), but the gift is expressly declared to be free of

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