IHTM14302 - Gifts With Reservation: identifying and investigating a GWR

The taxpayer should alert you to a GWR on page 3 of the IHT403 ( IHTM14025) or IHT100a ( IHTM14052) schedule. If the taxpayer does not consider that a GWR is in point however they may not declare it appropriately and you must adopt an investigative approach to the whole of the account and subsequent correspondence for any indicators.

• Apply the GWR requirement tests ( IHTM14301) by looking back from the donor’s death to the beginning of the relevant period to see whether there was property subject to a reservation.
• You can only determine whether a particular situation or arrangement constitutes a GWR by a consideration of all the facts, and on the basis of the law at the time of the donor’s death.
• You must obtain all the facts before deciding whether a GWR is in point. It cannot be over-emphasised that these are, in effect, anti-avoidance provisions. You should not use them to support claims to tax unless and until all relevant facts have been fully established and clearly point to there being such a claim.

What to do

Where you consider that there is a GWR, refer to Technical Group at the earliest possibility for advice on the claim.

The tax consequences, including determining double charges relief ( IHTM14711) will depend on whether the reservation still exists at the donor’s death, or ceased previously. You can find advice on how GWRs are brought into the charge for tax later in this section of the manual. ( IHTM14591).