Commentary

I9.321B Settled securities subject to an interest in possession

IHT, trusts and estates

I9.321B Settled securities subject to an interest in possession

I9.321B Settled securities subject to an interest in possession

As a result of the IHT rules treating interests in possession as equivalent to absolute ownership, the opportunity to convert settled property to excluded property by investing in exempt government securities is more readily available to interest in possession settlements than to ones with no interest in possession. In addition, no IHT charge arises from the conversion where settled property subject to an interest in possession is concerned.

Settled exempt government securities are excluded property if a person who (in certain cases) is not domiciled1 in the UK and (in all cases) not resident in the UK, is entitled to a qualifying interest in possession in the settlement2. 'Qualifying interest in possession' means an interest in possession to which an individual is beneficially entitled, or an interest in possession to which a company is beneficially entitled as a result of the commercial purchase of the interest in certain

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