IHTM04096 - Settled property: charges on property held in discretionary trusts

There are two types of charges on property held in discretionary trusts - called relevant property바카라 사이트�(IHTM04095).听

There is a charge every ten years (the ten-yearly charge), IHTA84/S64. The first is on the tenth anniversary of the date that property first became comprised听in the trust.听

The other charge is the proportionate charge, IHTA84/S65 which applies听

  • when the property ceases to be relevant property, IHTA84/S65 (1)(a) or听

  • when the trustees make a disposition (IHTM04023) which reduces the value of the relevant property, IHTA84/S65 (1)(b).听

The main examples of property ceasing to be relevant property are when听

  • the settlement (IHTM16041) comes to an end听

  • some of the property is distributed to beneficiaries听

  • an individual becomes beneficially entitled to an interest in possession (IHTM16060) in the settled property听

  • the property is appointed on special trusts바카라 사이트�(IHTM42801) and听

  • in some cases when the property becomes excluded property (IHTM04251) such as foreign听听property听comprised听in a settlement when the settlor ceases to be long-term UK resident (IHTM47000)听

There are various circumstances in which the charge under IHTA84/S65 does not apply听

  • when the property becomes excluded property under IHTA84/S48ZA because it becomes non-UK situs听

  • when the event which would otherwise give rise to the charge occurs in the바카라 사이트痶hree months after either the settlement commences바카라 사이트痮r바카라 사이트痑 ten-year charge arises, IHTA84/S65 (4), and听

  • where the property ceasing to be relevant property becomes听

  • the property of a qualifying charity or other exempt body, IHTA84/S76听

  • held on certain specified trusts for employees, IHTA84/S75 and S75A, where the property concerned is shares or securities in the company, or听

  • held on trusts of an approved fund for the maintenance of heritage property, IHTA84/SCH4/PARA16 onwards.听

Example听

Shona, a long-term UK resident, has a discretionary settlement which she made in 2003听while domiciled in the UK.听Shona ceases to be long-term UK resident on 6 April 2032 and the foreign property comprised听in her settlement becomes excluded property at that time.听There is a proportionate charge to reflect the period听since the last ten-year anniversary (in 2023) and the property听becoming excluded property on 6 April 2025.听