IHTM04056 - Lifetime transfers: loss to estate less than value of property given

The loss to the transferor’s estate ( IHTM04054) is less than the value of the property ( IHTM04030) given if the property given

• remains part of the deceased’s estate, ( IHTM04029)
• includes excluded property, ( IHTM04251) or
• if the transferee pays the expenses (other than any IHT on the transfer) incurred by the transferor in making the transfer, IHTA84/S164.

Example 1

A puts £200,000 into a settlement where the trusts are for A to life with remainder over. The £200,000 remains part of A’s estate, so although there is a disposition, ( IHTM04023) there is no loss to the estate and no transfer of value. ( IHTM04024)

Example 2

Under the Will of T, property is settled on L for life with remainder to R. R gives the reversionary interest ( IHTM16000) to L. The reversion is an item of property which has value. But it is excluded from the charge ( IHTM04281) which is disregarded in considering whether the disposition has given rise to a loss to R’s estate. The disposition is not a transfer of value.