IHTM14303 - Lifetime transfers: gifts with reservation (GWRs): devolution of GWR property

The gift with reservation provisions provide that the gifted property is deemed to be treated as part of the donor’s estate immediately before death. 

Although the property does not pass on death under the will or intestacy, exemptions that are available on death such as spouse exemption (IHTM11031) and charity exemption (IHTM11101) may be applicable to the transfer deemed to be made on death if, on death, the property passes to an exempt beneficiary.   However, if the reservation ceases during the lifetime of the donor, since the donor is deemed to have made a disposition which is a potentially exempt transfer (IHTM04064), no exemptions can apply.

Annual exemptions (IHTM14141) will not apply to the transfer deemed to be made on death or deemed to be made when the reservation ceases.