When a Charitable principle is not enough

Charity
Typography
There is a general principle in UK law that assets left on death to charities are excluded from the deceased person's estate for Inheritance Tax (IHT) purposes.
A Jersey-domiciled woman died in 2007 left a UK estate of some £1.8 million. The UK estate was left to a charity to benefit people in Jersey and a claim was made to exempt the assets from IHT.
 
 
It seems cliched to say that the law is what the law is, but in cases where a decision is reached that is correct under the law but which seems unfair, or not in accordance with an underlying principle, it will nevertheless stand.
 
However, HM Revenue and Customs (HMRC) argued that although it was not relevant that the charitable purposes for which it was established were for the benefit of people outside the UK, the fact that the charity concerned was established outside UK jurisdiction meant the claim had to be rejected.
 
The case went all the way to the Court of Appeal who ruled in HMRC's favour, triggering an IHT charge of some £600,000.
 
There is a further appeal, which is based on European law against restrictions on the free movement of capital which is now being pursued.
 
 
Legal Pages sponsored by
 
 
 
 
 
 
 
 
Advertisement
Advertisement
Advertisement
Advertisement
Advertisement
Advertisement
Advertisement