Inheritance Tax: Gift with Reservation and spouse exemption

8 Mar 2021

CIOT, together with other professional bodies, has been discussing with HMRC the availability of the inheritance tax (IHT) spouse exemption in relation to assets held in a trust that are treated as beneficially owned by the settlor as a result of the reservation of benefit rules.

HMRC has indicated its agreement to the analysis set out in this note and on 1 March 2021 amended the IHT manual (IHTM14303) to reflect this.