The impact of Raboni on inheritance tax planning

Key points

• Inheritance tax is not only triggered in the event of death but can also be triggered during one’s lifetime.
• Legislative anti-avoidance provisions can give rise to unexpected IHT liabilities.
• In addition to a standard nil-rate band people can inherit a transferable NRB from a spouse and sometimes also have a residence NRB.
• Both the donor and the donee (and sometimes trustees) are liable to pay IHT and it is important to identify in planning who is intended to pay any tax that might arise on a gift.
• There are ways to avoid some of the charges due when settling assets into trust.
• Some reliefs are fairly easy to ascertain whether or not they apply while other reliefs (like business or agricultural relief) have subjective conditions that can be open to challenge by HMRC.
• A possible way to increase the availability of liquid assets to pay...