The deceased’s purchase of an income interest in an offshore trust was a transfer of value for IHT purposes as it did not fall within the exception for dispositions not intended to confer a gratuitous benefit. 

Summary

The deceased’s purchase of an income interest in an offshore trust was a transfer of value for inheritance tax (IHT) purposes as it did not fall within the exception for dispositions not intended to confer a gratuitous benefit. 

Background

The deceased (DRB) had been diagnosed with a terminal brain tumour in 2007. He died on 17 July 2008. Following DRB’s diagnosis, the appellant (DRB’s son and the executor of DRB’s estate) entered into a pre-planned scheme offered by a large accountancy firm, which was implemented on 11 June 2008. 

A number of excluded property trusts (outside the scope of IHT) had been established in Guernsey. A