I’ve had an extensive read through the various posts regarding IOU and charge schemes etc.
However, I have a case where there are sufficient ‘non-property’ assets to satisfy any NRB; cash of about £250,000 and ISA and bond for the remainder. These have been transferred to the surviving spouse before my involvement. Residue passes to the Spouse (not into an IIP).
The Will contains power to:
power to accept an IOU from Spouse; or
lend money, on whatever terms, with power to waive any interest if applicable.
I’m trying to figure out the simplest route of satisfying the NRB and ensuring there is a deductible debt on her death.
The trustees can “adopt the transaction” by a current document appointing sufficient assets to discharge her loan as of the date it was made. It must surely be arguable that whoever made the prior transfers of assets must have been the then trustees as a body intending to transfer the beneficial interest and, without positive evidence to the contrary, not by way of loan. The conclusion of that analysis is that a appointment has already happened.
Presumably a nil rate of IHT will apply and no CGT on non-cash assets, so no inconvenient reporting requirements,. I would make the background facts plain in a Recital so the parties are not open to the accusation of backdating.
You do not say who the trustees are but the current trustees are the proper parties and if one is dead or or refuses and cannot be removed you might have to ignore them. If an appointment has already happened the duty of any living current trustee is to sign and not be obstructive, if they cannot offer a cogent alternative analysis. Remind them of the possibility that if directions are forced to be sought and found to have been sought unnecessarily they might have to pay the costs.