Commentary

I4.161AA Cumulation, tax rate and allocation of liability―examples

IHT, trusts and estates

I4.161AA Cumulation, tax rate and allocation of liability―examples

I4.161AA Cumulation, tax rate and allocation of liability―examples

Examples of cumulation, tax rate and allocation of liability

Example 1—basic cumulation on death

T died on 1 January 2020 with an estate valued at £300,000. By his Will T left £80,000 free of tax to his daughter D, the residue of the estate to be divided equally between his wife W and his son S.

In addition to using his annual exemptions, T had made the following lifetime gifts:

  1.  

         1 February 2012 a chargeable transfer to a family discretionary trust, £100,000.

  1.  

         1 May 2014 a chargeable transfer to a discretionary settlement, £400,000,

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