Commentary

I5.210 General rules for taxing QIIPs

IHT, trusts and estates

I5.210 General rules for taxing QIIPs

Tax treatment of qualifying interest in possession (QIIP)

I5.210 General rules for taxing QIIPs

A person with a qualifying interest in possession (QIIP) is treated as absolutely entitled to the trust assets for IHT purposes1. Special rules apply for part interests and annuities.

It is however specifically provided that where a person purchases a QIIP, the extent to which his payment for it is a transfer of value is assessed on the basis that it is the interest in possession that has been added to his estate and not the underlying settled property2.

Broadly, the above rules mean that the creation

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