Discretionary trusts: liaison with HMRC Trusts
Use form Lit1 to advise HMRC Trusts of new settlements. (IHTM09230)
HMRC Trusts use form Lit2 to notify Capital Taxes of a transfer out of a trust for which holdover relief is claimed. Lit2 should be passed directly to Lifetime Team Risk Assessors in Nottingham to deal with.
Risk Assessors will identify and obtain any relevant papers held by Capital Taxes to advise HMRC Trusts (if possible) whether there is a claim for inheritance tax. The TCGA92/S260 claim is allowable for gifts on which inheritance tax would be payable, not necessarily where any tax is actually payable.
- If the transfer appears to be from a Will Trust within 2 years of death, S144 may be in point so no holdover relief will be due. (IHTM42227)
- If Capital Taxes do not appear to hold any records about the initial transfer into trust (IHTM42251) or the disposal, and the amounts are significant, the Risk Assessor will contact the taxpayer and request an IHT100 account.
HMRC Trusts use Lit3 to enquire about ‘ascertained values’ for inheritance tax, to verify values used in trust and estate CGT returns. These are dealt with by Compliance Lifetime Transfers Team.
Trusts cases database
RRLT hold a separate database of all HMRC Trusts cases where a SA return has been received.
General liaison with HMRC Trusts
For exchange of information specific to a Trusts case, contact the liaison officer in Lifetime Transfers Team Nottingham. (General advice at IHTM09231 applies.)
If you have information relevant to CNR (IHTM42640), or would like to obtain some information from that office, contact the liaison officer in Lifetime Transfers Team Nottingham.