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HMRC internal manual

Inheritance Tax Manual

From
HM Revenue & Customs
Updated
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Lifetime transfers: gifts with reservation (GWRs)

The accountability depends on whether the gift is treated as a potentially exempt transfer (PET) (IHTM04057) or as part of the death estate.

The prescribed account for GWRs is the IHT 100. The time limit for delivering the account is 12 months from the end of the month in which the transferor’s death occurs. There is no obligation to account for exempt transfers.

Treated as PET

The transferee is normally accountable, IHTA84/S216 (1)(bb).

Treated as part of the death estate

The legislation does not make transferees expressly accountable but they will normally be accountable under IHTA84/S216 (1)(bc).

For deaths on or after 9 March 1999, the deceased’s personal representatives (IHTM05012) must include full details of any gifts made by the deceased within 7 years of death with the IHT 400, FA99/S105 (1). This means that in some circumstances (IHTM10504) an IHT 100 may not be required. But you should approach the transferees if a formal account is required.