Deed of variation

[Doris]

When my Father died in October 1999, my Mother had already moved into a Retirement flat 4 months earlier. Because she had not sold her original house, she transferred his half of the house to me by Deed of Variation and gave me her half. If my Mother dies before 7 years is up how much of the value of the house has to be used for calculating if IHT is due? i.e. Is it just the value of her half at the time of the gift or does the whole amount have to be taken into consideration?
Also, is there a graduated scale depending on the length of time that has elapsed after the gift. Thank you for your help

[Instinctive]

Only your mother's half share would be considered as her assets for IHT. There is a graduating scale after 4 years have elapsed.

Ramnik

[bob.fraser@towrylaw.]

The sliding scale only comes into play if the total value of the assets gifted within the previous 7 years exceeds the nil rate band.