ISSUE
Whether the (now deceased) occupier had enjoyed an Interest In Possession arising under a will, such that his estate was liable for IHT. HMRC said that he had, the Appellant Trustees disagreed.
FACTS
By her last will dated 24 July 2003 (“the Will”) the Deceased devised her property at 51 Fortis Green in East Finchley, London (“the Property”) on trust for her nieces, nephews and a friend but subject to a direction that her trustees “shall not sell or dispose of the said freehold house during the lifetime of Lazzaro Boggia without his consent in writing… the same shall be retained as his home for so long as he shall desire without charge BUT he being responsible for the full cost of insuring the same… as well as paying all outgoings relating thereto arid the expense of proper and adequate maintenance and repairs as well as decorations”. The said remainderman were also the residuary beneficiaries.
When the Deceased died in 2004, IHT was due on her estate in the sum of around £15,600. However, her residuary estate only contained around £7,000 of assets, so the balance fell to be paid from the Property (see section 34 & Part II of the First Schedule of the Administration of Estates Act 1925). The residuary beneficiaries were advised, rightly or wrongly (no determination being made), that the Property would have to be sold subject to Mr Boggia’s right to reside and so they unanimously agreed that they would personally pay the IHT and retain the Property as an investment.
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Please click on this link to read the full article by Lydia Pemberton on the decision in Nicholas John Hall and Christopher Valentine Lopez (as Trustees of the Carolina Raboni Estate) v HMRC [2022].