Residential Nil Rate Band Query


I am hoping someone here may be able to help me with whether it is possible to claim the residential nil rate band on a file I have inherited.

I have a Will that gifts a property “UPON and PROVIDED THAT X attains the age of 25 years” - initially my predecessor thought that this was a 18-25 trust, but it seems that if there is a contingency by the use of the words “Provided that” it is not a 18 - 25 trust.

I did some research and it was commented on another post that where a beneficiary becomes entitled to income within 2 years of the date of death of the deceased, the trust becomes an immediate post death interest which is subject to being able to claim the RNRB.

It is the case that the beneficiary will be 18 within 2 years of the date of death of deceased, but is currently a minor.

Does anyone have any suggestions or input for me please? I would be most grateful to hear anyone’s thoughts on what I could do to claim this additional allowance, as so far, I only have £325,000 to work with and property does form a part of the estate valued in the region of £800,000.

A child who, on attaining a specified age, is entitled to a residential interest does not inherit for RNRB purposes if the child has not attained that age on the death of testator unless the trust is an 18-25 trust (or a bereaved minors trust).

Malcolm Finney

If the beneficiary becomes age 18 within two years of the testator’s death then under TA 1925 s31 income will be invested in the beneficiary and an interest in possession (IIP) arises. Under IHTA 1984 s144 the IIP is read back as an IPDI.

If the beneficiary is a lineal descendant then a RNRB becomes available.

Malcolm Finney