PETS and Flexible Life Interest Trust

[Yiannis17]

Morning

If a couple transfer 50% of their main residence into a life interest trust and the balance to their children. Should one of the parents pass away within 7 years of the gift, would 50% of the transfer form part of his/her estate or is it the 25%? Ofcourse tapering relief will be taken into consideration if applicable.

Thank you

[AGoodman]

Within 7 years it would be 50% of the property (albeit under two slightly different regimes as one transfer was immediately chargeable and the other was a PET).

After 7 years it could still be 50% of the property unless they had avoided the transfers creating a reservation of benefit.