As we previously discussed…Obviously too late now, but.
Families who tried to dodge inheritance tax using a controversial scheme could save substantial sums in death duties following a landmark ruling.
One family has knocked an estimated £700,000 off their inheritance tax bill thanks to a home loan scheme after the Court of Appeal rejected a challenge by HMRC.
According to court documents, Leslie Elborne arranged a home loan scheme in 2003 with the aim of removing her £1.8m house from her estate for tax purposes while continuing to live there rent-free.
Thousands of home loan schemes were set up in the 1990s and 2000s, sometimes with the help of reputable wealth managers, to shield families from inheritance tax.
Under the scheme, Ms Elborne sold the property to a trust for the benefit of her children in exchange for a loan note. She then gave this IOU to a second trust, also for the benefit of her children. Because she died in 2011, more than seven years later, this transfer left her estate and was not subject to inheritance tax.