Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Relevant property definition

What does Relevant property mean? In UK trust practice, relevant property means trust assets that fall within the inheritance tax (IHT) “relevant property regime”, under which trustees may face ten‑yearly (periodic) and exit charges when property is distributed or appointments are made. The term is statutory and used consistently across England and Wales, Scotland and Northern Ireland under the Inheritance Tax Act 1984. Most discretionary trusts, and many lifetime trusts created on or after 22 March 2006, hold relevant property. Key exclusions include property in qualifying interest in possession trusts (for example, an immediate post‑death interest or a transitional serial interest), disabled person’s interests, bereaved minors’...

UK IHT exit charges for relevant property trusts: scope, calculation, reporting and planning (post-18 Nov 2015)

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Practice notes

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This Practice Note is intended to be read alongside the following flowchart. For an introduction to the Relevant property regime for trusts, see Practice Notes: Trusts—Inheritance tax—overview and The meaning of Relevant property. The inheritance tax (IHT) charge on relevant property arises on two occasions:

the periodic ten-year anniversary of the settlement’s creation (the principal (ten-year) charge), and
when property (or value) ceases to be relevant property other than on excepted occasions (the exit charge)

For further guidance on the exit charge as it applied prior to 18 November 2015, see Practice Note: before 18 November 2015. This Practice Note examines the calculation of the exit charge on relevant property on or after 18 November 2015 in more detail. The principal emphasis is on inter vivos trusts.

The exit charge—what constitutes an 'exit' subject to charge?

Before moving to the method of calculating exit charges, it is necessary to determine whether the event genuinely amounts to an ‘exit’ that is chargeable. An exit occurs when trust assets no longer comprise relevant property, or when the trustees make a disposition that brings about a reduction in the value of the relevant property. So, for...

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Alexander Erskine

Taylor Wessing LLP

Alexander is a Senior Counsel in the Private Client department at Taylor Wessing LLP. He specialises in complex, cross-border fiscal and succession planning, acting for both individuals and professional trustees. His practice is international in nature, covering primarily Europe and Asia. Alexander also has particular expertise in UK tax compliance, helping both individuals and professional trustees discharge their obligations and manage their risk in relation to complex positions. Alexander has advised in relation to complex, high-value HMRC disclosures under different disclosure facilities, unwinding complex asset-holding structures in a tax compliant manner, the creation and administration of structures holding high-value assets, and managing institutional risk in connection with the same. Alexander is a member of the Society of Trust and Estate practitioners. Alexander was recognised by the leading Eprivateclient publication as a Top 35 Under 35 in the 2015 and 2018 awards....

Web page updated on 22/05/2026

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