I am going around in circles slightly and hope you might be able to help me.
My client settled funds into a Discretionary Trust within the last seven years. She is a beneficiary of the Discretionary Trust.
My understanding is that the gift into the trust was a Chargeable Lifetime Transfer and that the Nil Rate Band on death will be reduced by the value of the gift unless she survives seven years from the gift into trust. The gift did not exceed the Nil Rate Band at the time it was made.
Additionally, I understand that this is a Gift with Reservation of Benefit and that my client’s taxable estate on death will be increased by the date of death value of the Discretionary Trust.
Am I on the rights lines? It seems tough that my client may suffer both the increase in her estate by virtue of the GROB together with the reduction in her NRB by virtue of the LCT…
Many thanks all.