Upper Tribunal confirms sub-lease granted to sons was a Gift With Reservation for Inheritance Tax Purposes

The Upper Tax Tribunal upholds the lower tribunal’s 2016 ruling that a sub-lease, granted by the late Lady Diana Hood to her sons, was a gift with reservation of benefit for the purposes of inheritance tax. The ‘reserved benefits’ were covenants in the sub-lease that relieved the sub-lessor from performing certain provisions imposed on the lessor by the head lease – Executor of Estate of Lady Diana Hood v HMRC, 2017 UKUT 0276 TCC