IHTM14165 - Lifetime transfers: schemes to exploit annual exemption: split proceeds from property on trust for sale

The deed provides that the property is held on trust for sale and that the proceeds are held as to £x for the donor (the deceased) and the balance for the donee. £x may be £3,000 less than the stated value of the property.

• The initial transfer is of the property at its open market value, less £x.
• If a later deed reduces the proceeds held for the donor to £y, the value then transferred is £x minus £y.

Include in the donor’s estate on death the amount shown as held for the donor in the last relevant deed executed before the death.

Refer any Scottish deed attempting to transfer part of a property in this way to Technical.