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Transfer of farmland out of a trust
A family farming partnership comprising father mother son daughter and son’s wife farmed land owned by the father. The father died intestate in April 1973 and the mother son and daughter became the administrators of his estate.
Under the intestacy rules the mother received a life interest in half of the residuary estate and the son and daughter received a quarter each. The mother died in 2006 whereupon the son’s daughter also became a partner.
Our understanding is that because the father died intestate before 13 November 1974 under the rules of intestate succession the mother’s life interest in her husband’s residuary estate constituted a “golden trust”.
Consequently the capital was not subject to inheritance tax on her death and the son and daughter become became absolutely entitled to the trust assets.
However those assets comprising the farming...
