The following Trusts and Inheritance Tax guidance note by Tolley provides comprehensive and up to date tax information covering:
This guidance note provides an overview of the basic principles of inheritance tax, when it is charged and how it is calculated. It contains links and references to other parts of the module where more details can be found.
Inheritance tax is based on the concept of a transfer of value. A transfer of value is defined as a ‘disposition made by a person (the transferor) as a result of which the value of his estate immediately after the disposition is less than it would be but for the disposition’. Thus the definition identifies the key event as a ‘disposition’.
A disposition is, typically, a gift. There must be an element of bounty, otherwise the value of the transferor’s estate would not decrease. A disposition can be:
In addition to occasions when property is actually transferred to a new owner, a disposition can occur when certain events or arrangements cause a diminution in the value of property. These notional dispositions may arise:
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