Commentary

I3.512 Other factors affecting failed PETs

IHT, trusts and estates

I3.512 Other factors affecting failed PETs

I3.512 Other factors affecting failed PETs

Apart from cumulation and tax rates as considered in I3.511, there are other sets of rules affecting the IHT charge on a potentially exempt transfer (PET) that becomes chargeable (a 'failed PET'), as follows:

  1.  

    •     BPR or APR, which can cancel the IHT charge completely where the rate of relief is 100% — see I7.101 and I7.302.

  2.  

    On the other hand relief that was applicable at the time of the transfer can be lost as a result of clawback (see I7.191 and I7.381). see the example below and the more extended example in

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