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HMRC internal manual

Inheritance Tax Manual

Structure of the charge: how meaning of estate is restricted

Property is not part of the transferor’s estate where

  • it is uncertain which of two (or more) persons survived the other(s), (IHTM12191) IHTA84/S4 (2). Generally, the younger person is deemed to have survived the elder, the younger person(s) estate does not then inherit property from the estate of the elder person. This rule is subject to exceptions in Scots law under the Succession (Scotland) Act 1964 (IHTM12193),
  • the transferor is entitled to property as a corporation sole, IHTA84/S271. Such property is not property to which that person is beneficially entitled (except for the purposes of IHTA84/S59). An example is property held by a bishop by virtue of their office, (IHTA84/S59 defines qualifying interest in possession for the purposes of settlements without interests in possession.)
  • a person acquires a reversionary interest (IHTM16000) at a time when they had a prior interest in the settled property, IHTA84/S55 (1). The reversionary interest is not part of the estate, although there may be a charge on the lifetime transfer (IHTM04282)
  • the legislation specifically excludes (IHTM04251) the property from charge.