Excluded property trusts - Boodle Hatfield

Your lawyers since 1722

06 Jul 2020

Excluded property trusts

Changes to EPTs will shortly be enacted in Finance Bill 2020 and consequently additions of property, at a time the settlor had become UK domiciled or deemed domiciled, will not be excluded property and so will be within the UK IHT net.

There are concerns that the new legislation may lead to unintended consequences. In particular, some transfers between trusts after the settlor has become deemed or actually domiciled in the UK may cause property to be caught by the gift with reservation rules. If you set up an excluded property settlement and have since become UK domiciled or deemed domiciled, it may be advisable to seek a ‘health check’ of your trust in light of these rules.