IHTM42221 - The settlement: Commencement date of the settlement

The starting date – the commencement - of the settlement is defined under IHTA84/S48A as the time when property first became comprised in it, and not as any later time when it first became held on relevant property trusts. This date, in turn, sets the date(s) for the ten-year anniversaries. 

In the case of trusts created by will, IHTA84/S83 provides that the starting date is the date of death.   

If a will or intestacy is altered by an instrument of variation (IOV) to create a trust, the start date is taken back to the date of death. (IHTM42228)

For the purposes of the ten-year anniversary (TYA) charge, the trust’s starting date is never altered. For example, trusts that were previously subject to IHTA/S71 will cease to be so if they do not provide – or are not modified to provide before 6 April 2008 – absolute entitlement at age 18 or 25. The settled property will become relevant property when S71 ceases to apply (IHTM42087), but the starting date of the settlement does not change.

IHTA84/S80 provides an artificial start date if the settlor or their spouse had a qualifying interest in possession when the trust commenced. However the TYA date reflects the first start date. (IHTM42231)