Is it a PET

[walkerj]

I have a flexible Gift Trust Policy with a life assurance comapny for a level term life assirance policy into which I pay £3,500 to give me a level of life cover should I die.

The policy has no cash in value at anytime.

My first question is are the payment of these premiums treated as PET's or a Chargeable transfer or neither?

My second question is I give away in cash about 20,000 per year to my children.

Is this a PET so does not need to be submitted on the annual IHT110 form or is it treated as a gift or transfer of value which would exceed the annual 10k limit and therefore need declaring on the IHT110 Inald Revenue form?









thanks.

[Lee Young]

(1) what are th terms of the trust over the life policy?

(2) PETs so not have any IHT compliance requirements, so therefore you need do nothing.

[walkerj]

Thank you for the reply regarding the cash pet's. It's good to know no paperwork needs to be done even if over 10k per annum.

Regarding the level term life assurance policy that has been written in trust - its a flexible gift trust policy - the beneficiaries are my two sons - it pays out on my death and will be outside my estate for IHT purposes - it was set up to cover some of my IHT liability if I should die in the next 30 years (age 90). If you want to give me more info and what terms you refer to I'll happily give details.

Thanks for replying.

[Lee Young]

Generally the payments are neither being covered by either your annual exemptions or gifts out of surplus income,. Assuming they are not covered by either then the pyaments are chargeable lifetime transfers.