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HMRC internal manual

Inheritance Tax Manual

Exclusions from exemption: interest reserved or created - property other than land

Under IHTA84/S23 (4)(b) a gift to a charity (IHTM11112) is not exempt if

  • the property given is not land or a building, and
  • it is given subject to an interest reserved or created by the donor other than
    • an interest created for full monetary consideration, or
    • an interest which does not substantially affect the enjoyment of the gifted property by the donee.

Whether property is given subject to an interest must be established twelve months after the transfer.

You should discuss the case with Technical before pursuing any tax.