What is the value of the GROB?

Trusts Discussion
1

I have an estate whereby my deceased client together with his ex-wife settled their family home into trust on divorce.

Mr and Mrs settled property into trust in 1987 - wife moved out.
Trustees named as Mr and daughter.
Beneficiaries daughter and son with power to postpone the sale of the property whilst either the settlors or trustees of the trust desire to live there.

Mr lived there until his death in 2024.

I am comfortable with the fact that Mr lived in settled property and therefore his share is a reportable GROB and i can claim RNRB for him.

My question is do i only report 50% of the value of the property on the basis that Mrs owned half and settled hers in 1987 and never lived there again?

I am unsure if Mr would be deemed to have a IIP over the whole 100% or if the 50% owned by ex-wife does not come into it for IHT but that the beneficiaries will need to pay CGT on this share despite dad always living in the property.

Thanks

2

Who lived there under the terms of the trust, only the Mr or any of his children too?
Sale of the property will be by the trustees for the period they have owned it, and to the extent that a trust beneficiary lived in it as their main residence, the trustees should be able to claim PPR or main residence relief for that period. Any gain arising subsequent to his death (assuming no children also lived there as their main residence after his death) will potentially be subject to CGT at the trust rate. The 50% previously owned by his ex-wife is irrelevant for CGT.
Maxine Higgins
TC Citroen Wells