Relevant Property Trusts and periodic charges (post 6 April 2026)
PippaO
Member
Hi there,
A technical 'post 2026 BR and trusts' question.
For trusts settled after 30/10/24, on the first 10 year anniversary after 6/4/26, these trusts will be liable to IHT periodic charges at 3% (based on 50% IHT relief) on the value of qualifying assets above the £1m trust allowance. But we also include the trust’s NRB, right? (£325,000 per settlor). So does this mean a trust may have assets of £1,325,000 before a periodic charge will apply?
I'm aware that trusts settled after 30/10/24 will share the £1m allowance, allocated to earliest trusts first (those settled before 30/10/24 will have their own £1m allowance)
Thanks.
Comments
If you look through the IHT100d you will see that you deduct reliefs from relevant assets first and then later deduct any available NRB before you get to the calculation.
So, yes, you can use both.
And the tax is 6%!
And Techzone is where I saw the periodic charge referred to as reduced to 3% by the 50% relief for qualifying BR assets…
https://techzone.aberdeenadviser.com/public/iht-est-plan/BR-consultation-rolling-£1M
Yes, technically the rate is reduced for BR not the asset value, although mathematically it adds up to the same thing whichever way you do it!
The rate is not reduced the value is reduced before applying the rate (you get to the same place)
Examples in here - fairly horrific https://www.gov.uk/government/consultations/reforms-to-inheritance-tax-reliefs-consultation-on-property-settled-into-trust/reforms-to-inheritance-tax-agricultural-property-relief-and-business-property-relief-application-in-relation-to-trusts#annex-a-case-studies