Discount Gift Trust Tax Man Appeal

Discount Gift Trust Tax Man Appeal

HM Revenue and Customs HMRC is appealing against the Special Commissioners’ ruling that people over 90 can benefit from discounted gift plans.  In February the Special Commissioners ruled against the HM Revenue and Customs’ view that a women in her 90’s who died five months after setting up a discounted gift trust should receive little or no discount as they would be uninsurable.  The executors of the woman argued that a discount should apply.  

Pending the appeal, the HM Revenue and Customs has posted a holding statement on its website, saying that existing open cases will remain under review but it will not press for additional inheritance tax payments until this test case is resolved.

Our view

We believe HMRC is wrong with regard to Discounted Gift Trusts.  Everybody is insurable.  It is just a question of cost.  Therefore, despite the fact that the discount should be small, there should still be a discount on investment and therefore the inherited amount.

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