Commentary

I12.1113 Possible types of trust which can be created by post-21 March 2006 wills, classified by their IHT treatment

IHT, trusts and estates

I12.1113 Possible types of trust which can be created by post-21 March 2006 wills, classified by their IHT treatment

I12.1113 Possible types of trust which can be created by post-21 March 2006 wills, classified by their IHT treatment

The types of trust are:

  1.  

    (a)     Immediate post-death interests ('IPDIs'), ie interest in possession trusts which are treated for IHT in the same way as interests in possession trusts were treated before 22 March 2006. The property subject to the IPDI is beneficiary-taxed for IHT purposes, ie treated as if it were the property of the person entitled to the IPDI (see I5.205). Overriding powers can be combined with an IPDI, but such powers should be ones under which the interests in remainder can be altered without the IPDI being terminated, since if it is terminated and the trusts continue, even in the form of another interest in possession for the same person, there will be an immediate IHT charge on the termination of the IPDI. The settled property is not subject to periodic charges while the IPDI continues,

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