Commentary

I4.154 Non-deductible liability to donee―relationship with exemptions

IHT, trusts and estates

I4.154 Non-deductible liability to donee―relationship with exemptions

I4.154 Non-deductible liability to donee―relationship with exemptions

If the creditor under a debt which is non-deductible by virtue of FA 1986, s 103 (or is non-deductible because it was not incurred for full consideration1) is an individual or body of persons who are such that gifts to them may be exempt, for example the deceased's spouse or civil partner or a charity, it is arguable that the non-deductible liability cannot qualify as exempt from inheritance tax.

The possible difficulty is similar to that which affects the availability of exemptions in relation to property subject to a reservation at the donor's

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