Inheritance Trusts were designed as a means of limiting to the
charge to CTT by “freezing” the value of a large
element of the transferor’s estate and allowing any growth on
that element to take place in the estates of intended beneficiaries
free of tax. These schemes were therefore known as “estate
freezing” schemes.
There are two basic types, the “original” scheme
(
IHTM20511) and the “reverse
loan” scheme (
IHTM20521).
It was considered unreasonable for individuals to limit their
estates in such artificial ways, and legislative changes were
introduced to counteract them.
