Commentary

I3.522 CLTs—changes in rates of tax

IHT, trusts and estates

I3.522 CLTs—changes in rates of tax

I3.522 CLTs—changes in rates of tax

IHT on a chargeable lifetime transfer (CLT — see I3.319) is charged according to the rate table in force at the date of the chargeable transfer. If the rate table is changed subsequently, later transfers are taxed at the new rates but the cumulative total reached under the old rates is not affected, even though it is a total arrived at by grossing up.

Example

In May 2008 the nil rate band was £312,000. If at that time, A, who had made no previous chargeable transfers, made a transfer to a discretionary trust of £320,000 (net

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