Discretionary Trust - occupation by beneficiary for 20+ years by beneficiary who has now died.

Good afternoon,

Another administration question. Deceased was in occupation (for 20+ years) of a property wholly owned by a discretionary trust set up by her father approximately 30 years ago. The only asset of the trust is the property. Deceased lived there rent free.

At present we have been unable to locate any documentation to confirm how the deceased was in occupation (eg under an ongoing licence to occupy granted by trustees or if property had been appointed out). The property has always been in the name of the trustees at the Land Registry.

Does anyone have any experience as to the view the revenue takes on long term occupation of trust property by a discretionary beneficiary? Primarily I am concerned that without any documentation the revenue may take the view that the ongoing rent free occupation is enough to classify the occupation as an IIP.

Any comments or thoughts appreciated.

L Driscoll
Watts Gregory LLP