Excepted transfers and terminations - regulations for transfers and terminations prior to 6th April 2007
From 6 April 1981 certain small lifetime transfers and terminations of an interest in possession (IHTM16091) were excused from delivering an account. The original regulations were reproduced as SI2002/1731 IHT (Delivery of Accounts) (Excepted Transfers and Terminations) Regulations.
An excepted transfer is a chargeable transfer (IHTM04027) made on or after 1 April 1981 which is a disposition (IHTM04023) by an individual, but not anything that is treated as a disposition for tax purposes where
- the value transferred by all chargeable transfers made in the year ending 5 April does not exceed £10,000, and
- the cumulative value transferred by that and all previous chargeable transfers in the ten years prior to the transfer does not exceed £40,000.
An excepted termination is the termination of an interest in possession (IHTM16091)
- the transferor has given notice to the trustees under IHTA84/S57(3) of the availability of an exemption, and
- the value transferred as a consequence of the termination does not exceed the exemption specified in the notice.
These regulations were of very limited effect for IHT as most of the transfers to which they could apply after 18 March 1986 qualified as potentially exempt transfers (PETs) (IHTM04057) where no return is required in any event. Their only application was to very small transfers that were immediately chargeable to tax such as transfers to or by close companies (IHTM04068) and transfers into discretionary trusts (IHTM04067).