TAG Tax

Contact: Boodle Hatfield LLP (London, England)

HMRC has formally launched a consultation on its proposals to simplify the calculation of IHT on so-called “relevant property” trusts. These include all discretionary trusts (whenever made) and most lifetime trusts created since March 2006. Relevant property trusts are subject to IHT at 10 yearly intervals and whenever capital is paid out of the trust. IHT is currently charged at a maximum rate of 6% but the effective rate is often much less, taking into account the trust’s available nil rate band ('NRB'). This is currently calculated in accordance with a complex formula. 

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