I’ve missed something here – in part 2, Illustration 3, we are told that the trust is for £400,000 but the transfer of value is £450,000? Could you explain how this £450,000 was reached?
IHT PART 2 18:07 why is there no need to add the 65500 tax due with the chargeable amount to reach the gross c/f ? we added it in the first transaction to reach the c/f gross. why not on the last transaction ?
I have a feeling it’s because for the first CLT (2008/09) it was the DONOR who agreed to pay the IHT , and whenever the donor pays, to get to the gross chargeable transfer amount , you will add the chargeable amount + lifetime tax due. If the DONEE pays the IHT on the CLT (which is what happens in (14/15), to get to the gross chargeable transfer amount, you ONLY stick to chargeable amount and NOT add the lifetime tax due. That’s my understanding!
CraigNorthwood says
I’ve missed something here – in part 2, Illustration 3, we are told that the trust is for £400,000 but the transfer of value is £450,000? Could you explain how this £450,000 was reached?
iEND says
IHT PART 2 18:07 why is there no need to add the 65500 tax due with the chargeable amount to reach the gross c/f ? we added it in the first transaction to reach the c/f gross. why not on the last transaction ?
Tharsika19 says
I have a feeling it’s because for the first CLT (2008/09) it was the DONOR who agreed to pay the IHT , and whenever the donor pays, to get to the gross chargeable transfer amount , you will add the chargeable amount + lifetime tax due. If the DONEE pays the IHT on the CLT (which is what happens in (14/15), to get to the gross chargeable transfer amount, you ONLY stick to chargeable amount and NOT add the lifetime tax due. That’s my understanding!