Client has Estate worth £1.5m, within which a plot of land worth £100k. Client wishes to gift land to children. Advice has been given to do this via a discretionary Trust as the £100k is then outside of Client's Estate.
Am I correct in thinking this makes no difference to the IHT position:
If gifted to children outright, this is a PET. If Client dies within seven years the land falls back into the Estate of the Client and is liable to IHT over and aboe nil rate band.
If put into Discretionary Trust, and Client dies within seven years, the value of the lifetime transfer is deducted from the remaining available nil rate band so the net result is the same as an outright gift?
There is no CGT exposure as market value is equal to cost.