I am applying for probate for an estate where husband has passed away first. His will contains a nil rate band trust and then the residue passes into a Flexible Life Interest trust for the benefit of his wife. He has used up over half of his nil rate band with lifetime gifts. The estate is not taxable, however my question is regarding whether or not the estate is classed as excepted estate, as the guidance from HMRC states “if the estate includes any assets held in a single trust, where the trust includes assets that pass to spouse or charity, the value of those assets is limited to £1 million and the net chargeable value after taking off spouse/charity exemptions doesn’t go over £250k” - will the Will be classed as containing two separate trusts? If a Deed of Appointment is entered into before probate is applied for to appoint all but the half share of the property out to the surviving spouse would this avoid the need to complete an IHT400?
I think the excepted estates regulations apply to settlements to which the deceased had an entitlement, rather than settlements created by the deceased’s will.
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