Hi,
My father passed away recently and I’m completing the IHT400 form.
My parents property, held as Tenants in Common, and worth approx. £700k, is subject to the equivalent NRB being put into a Discretionary trust with the beneficiaries stated as my mum (his spouse) and dependents (myself and my sister) in the Will. The main purpose of this being to ensure that this proportion of the property cannot be used for Nursing care, in the event that it becomes necessary for my mum.
For the residuary estate my mum is the sole beneficiary so Spousal Exemption applies. The residuary estate being circa. £700k, hence why IHT400 is required.
I’m unclear as to how the Discretionary Trust is represented on the IHT400 form and what actions have to be taken post completion of the IHT and probate process to execute this Discretionary Trust? I’ve included half the property value on IHT404, but given the Discretionary trust, how much Spousal exemption do I include for the property?
I assume that the trust will be £325k, equivalent to the NRB, so no IHT is due.
Thanks
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