I10.232 Annuities

I10.232 Annuities

Annuity for life

Where X's legacy is in the form of an annuity for life it is necessary to ascertain the amount by which the annuity is to be reduced if it is to bear a rateable part of IHT. By Re Parker-Jervis1 it would seem that the 'slice' of capital supporting the annuity should be calculated according to the income yield of the estate; the IHT should be notionally apportioned between this 'slice' of capital and the rest of the capital; and the annuitant in reduction of the annuity should be charged with interest on the IHT attributable to that 'slice'. If the tax has been raised by mortgage the rate of interest

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