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Not gratuitous
Dr Postlethwaite deceased was the sole beneficial shareholder and a director of P Ltd a non-resident company. In 1991 P Ltd agreed to provide Dr Postlethwaite's services to an Italian company and the company contracted to pay him a regular salary with bonus and pension. In 1993 the Italian company contributed £700 000 to the trustees of a funded unapproved retirement benefits scheme for Dr Postlethwaite. The trustees transferred this to a Manx company which then issued ten assurance policies of £70 000 each on the lives of the deceased and his wife. He died in 1999 aged 55.
HMRC said in 2005 that the 1993 payment from the Italian company was a transfer of value which was not a disposition intended to confer gratuitous benefit. The executors appealed claiming that IHTA 1984 s 10 applied to the transfer ...
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