......and of course the land on which it is built and the large garden.
The Son then builds a self-contained annex to the house for the mother's sole occupation and constructs an entirely separately fenced garden for the annex.
The Son occupies the house solely by himself.
A Gift with Reservation has clearly occurred (in the absence of mother paying son a commercail rent for the annex) in relation to the original gift - the question is, should the value to be taken into account on death of the mother be the value only of the annex or of the whole property originally gifted?
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If the land has been divided, then the value which would be taken into account is the portion of the land which the donor continues to occupy.
It is a shame that the land has been divided, as a gift of an undivided share of land where the donor and the donee occupy is not regarded as a GWROB provided the donor pays at least his share of the outgoings.
It would have been possible therefore if mum had given away 99% of the land and continued to occupy the land.
Have a look at this. But read the leg. anyway.
http://www.hmrc.gov.uk/manuals/ihtmanual/ihtm14360.htm
HTH