We have two siblings whose mother has died; they are making arrangements with their stepfather which will probably need a deed of variation.
They want stepfather to stay in his home, but they want each person to own 1/3 of it. I have read about this case: https://www.accountingweb.co.uk/tax/personal-tax/iht-unintended-conseque... in which the will set up a trust, which generated a large IHT bill on the death of the life tenant. Can we avoid that with a less formal agreement, or does Trusts of Land and Appointment of Trustees Act 1996 Section 1 (which seems to be very broadly drafted) mean that there is still a trust?
Additionally, I note that this arrangement leaves the siblings with an interest in a residence which exposes them to the additional 3% SDLT charge in certain circumstances.
Is there a better way of dealing with this situation?