A tax planning arrangement involving the transfer of reversionary interest did not result in excluded property but resulted in a transfer of value. 

Tax planning arrangements were undertaken in 2010 to effect a disposition of property to the deceased’s (PL’s) family without an inheritance tax (IHT) charge. The arrangements involved the assignment of a reversionary interest of a reversionary beneficiary in an Isle of Man (IoM) trust (MTrust) to PL, who was then granted an option to become income beneficiary of the MTrust. Before exercising the option, PL transferred his reversionary interest to another trust (KTrust). HM Revenue and Customs (HMRC) issued IHT determinations on the basis that the arrangements involving PL constituted a transfer of value which, following his death, gave rise to an IHT charge. The appellants appealed. 

The appellants contended that the reversionary interest in the MTrust was property which was excluded