This appears to be an issue that has potentially fallen between the cracks, but I hope someone can bring this back from the brink!
W died in 2014 her Will creating two Flexible Life Interest Trusts.
FLIT1 was her share of the house with gift over to her 4 children, 1,2,3 & 4.
FLIT2 was the remainder with gift over to her husband’s children 3,4, 5 & 6.
The RNRB was not available at the time of her death so is available to the Estate of her husband (he is still alive), but children 1 & 2 will be disadvantaged if the TRNRB is applied to H’s estate which divides his estate between 3,4,5, & 6. (excluding 1 & 2.)
There is sufficient value in H’s half share of the house to absorb both allowances.
W had a full NRB and H has most of an NRB.
Common sense would suggest that each estate should benefit from its own NRB (in the usual way) and RNRB but it might be argued that Wife’s estate was never entitled to an RNRB and never could have qualified in its own right, so the benefit should be applied against H’s estate – as he lived long enough to be able to claim it! Understandably, H wants to avoid a future rift.
What is the correct apportionment of the TRNRB?
Number One Legal