IHTM35155 - IHT implications of an Instrument of Variation: excepted estates

Where a variation is effected on or after 1 August 2002, it is no longer necessary to send us the instrument unless it contains a valid statement of intent ( IHTM35058) and it results in additional inheritance tax being payable. So where we receive an IoV in an excepted estate (IHTM06011) we will return it with a covering letter (SL) explaining the new provisions.

Where you receive an IoV executed before 1 August 2002 in an excepted estate, you should not normally review the instrument and use SL57 to reply to the taxpayer. The exceptions to this is are

• where the taxpayers deliver a copy of the Will with the instrument, when the IoV should be considered in the normal way, or
  
• where the term of the IoV suggest that the estate is not an excepted estate, for example where the instrument is seeking to establish a nil-rate band trust, or where joint property passing by survivorship is being redirected and its value clearly exceeds the excepted estate limit. In these circumstances, you should ask the taxpayer to complete from Mis 22

(This text has been withheld because of exemptions in the Freedom of Information Act 2000)