Employee benefit trusts: property leaving employee benefit trusts: definitions
IHTA84/S72(6) gives definitions of ‘close company’, ‘participator’ and ‘year’ and incorporates the same anti-avoidance provision as in IHTA84/S53(6) in relation to acquisition for consideration.
S53(6) directs that
‘a person shall be treated as acquiring an interest for consideration in money or money’s worth if he becomes entitled to it as a result of transactions which include a disposition for such consideration (whether to him or another) or that interest or of other property’.
The subsection is designed to counter most sophisticated devices by which a settlor or their spouse or civil partner could in effect acquire the reversion for consideration. For example the purchaser might be a company in which the settlor held all the shares, or the trustees of a settlement in which they had an interest in possession. Alternatively, the reversioner might give the reversion to a company in which they held all the shares and the settlor might buy the shares and wind-up the company.