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HMRC internal manual

Inheritance Tax Manual

HM Revenue & Customs
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Excepted settlements - general conditions

For all relevant property trusts other than pilot trusts (IHTM06122), there are three general conditions that have to be met first before considering whether the occasion of charge is one that falls within the excepted settlement regulations. These conditions are that:

  • the settlor is domiciled in the UK at the time the settlement was set up and has remained so domiciled throughout the existence of the settlement until either the occasion of charge or the settlor’s earlier death,
  • the trustees of the settlement are resident in the UK throughout the existence of the settlement, and
  • there are no related settlements.

If the settlement fails any one of these initial conditions, it cannot qualify as an excepted settlement.