HC Deb 15 April 1958 vol 586 cc62-3

My next proposal concerns Estate Duty. Under the present law, if a life tenant of settled property disposes of his life interest to the reversioner within five years of his death Estate Duty is payable on the settled property on his death, but the converse case where the reversioner sells his reversion to the life tenant is not covered by the existing law, and the gap is being exploited to a considerable extent.

I propose to close this gap. The broad effect will be to charge duty, when the life tenant dies, on the amount paid by the life tenant for any reversionary interest in the settlement which he has acquired within five years of his death. The legislation will apply only where the purchase of the reversion and the death of the life tenant both take place after today. I do not expect any material gain to the Revenue this year, but there should be a gain of £2 million in a full year.