IHT100 Form UK: When Trustees Must Report Discretionary Trust IHT Events
Updated 31 May 2026 · 8 min read · Inheritance Tax & Trust Administration
Trustees of discretionary will trusts face ongoing IHT reporting obligations throughout the trust’s life — not just at the outset. The IHT100 form is filed at each chargeable event: the ten-year anniversary charge, exit charges on distributions, and the death of a life tenant. Understanding when to file (and when an exemption applies) is essential for compliant trust administration.
What Is a Relevant Property Trust?
A relevant property trust is a trust subject to the periodic charge and exit charge regime under IHTA 1984 Part III Chapter III (ss.58–85). Most discretionary trusts are relevant property trusts. Interest in possession trusts created on or after 22 March 2006 are also generally relevant property trusts (with exceptions for qualifying immediate post-death interests, disabled person’s trusts, and bereaved minor trusts).
Relevant property trusts are taxed under a special regime with three main charges: the ten-year periodic charge, exit charges on distributions, and the death of an interest in possession beneficiary. All three must be reported using IHT100.
The Four Types of IHT100
| Form | Event | Filing Deadline |
|---|---|---|
| IHT100a | Ten-year anniversary (periodic) charge | 6 months after end of the month of the anniversary |
| IHT100b | Exit charge (distribution from the trust) | 6 months after end of the month of the exit |
| IHT100c | Death of person with qualifying interest in possession | With the IHT400 (6 months after end of month of death) |
| IHT100d | Charge on death (certain trust events on death) | 6 months after end of the month of death |
The Ten-Year Periodic Charge
A discretionary will trust that holds relevant property must report and pay a ten-year periodic charge every decade. The effective rate is based on:
- The trust fund value at the anniversary date
- Added-back hypothetical transfers (settlor’s cumulative transfers, related settlements)
- The nil-rate band at the anniversary date
- The effective rate, capped at 30% of the standard 40% = maximum 12% — but most trusts pay far less
Example: a discretionary trust settled in June 2015 with a fund of £400,000 at its first ten-year anniversary in June 2025. If the nil-rate band (£325,000) and added-back transfers are such that the fund just exceeds the nil-rate band threshold, the effective rate may be only 1–2%. An IHT100a must still be filed even if the charge is very small.
Exit Charges on Distributions
Every time the trustees distribute capital from the trust — whether to a beneficiary absolutely or to a new sub-trust — an exit charge potentially arises. The rate is proportional to the number of complete quarters since the last ten-year charge (or since the settlement date for pre-anniversary exits). Maximum pre-first-anniversary exit charge: 3% of the distributed value. IHT100b must be filed within 6 months of the month of the exit charge event.
IHT100 vs IHT400: Key Distinctions
The IHT400 is filed once on death by the personal representatives of the deceased. The IHT100 is filed repeatedly by trustees at each trust chargeable event throughout the trust’s life — potentially every 10 years for the periodic charge, plus at every significant distribution. Trustees should keep a diary of upcoming IHT100 deadlines and obtain specialist IHT advice from their accountant or solicitor well in advance of each ten-year anniversary.
FAQs
What is the IHT100 form used for?
Form IHT100 is an HMRC inheritance tax return used by trustees of relevant property trusts (principally discretionary trusts and certain interest in possession trusts) to report chargeable events that give rise to IHT liability. It is distinct from the IHT400 form, which is the estate return filed on death. The IHT100 covers four categories of chargeable event in relevant property trusts: (1) The ten-year anniversary charge (IHT100a) — the periodic charge levied on the trust fund every ten years from the date the settlement was created. (2) Exit charges (IHT100b) — distributions from the trust fund to beneficiaries, both in the period before the first ten-year anniversary and in subsequent periods. (3) The death of a person with a qualifying interest in possession (IHT100c) — where a life tenant dies, their interest in possession is treated as forming part of their estate for IHT purposes under IHTA 1984 s.52. (4) Charges on death — specific charges arising on the death of a beneficiary in certain types of trust.
When must IHT100 be filed — what are the reporting deadlines?
The deadline for filing IHT100 and paying any IHT due depends on the type of chargeable event: (1) Ten-year anniversary charge — the return must be filed and tax paid within 6 months of the end of the month in which the ten-year anniversary falls. For example, if the trust was settled on 1 June 2015, the first ten-year anniversary is 1 June 2025, and the return and payment are due by 31 December 2025. (2) Exit charge — the return must be filed and any tax due paid within 6 months of the end of the month in which the exit occurred. (3) Death of a person with an interest in possession — the return is treated as part of the deceased's IHT return; it is filed alongside the IHT400 for the death estate, with any tax due 6 months after the end of the month of death. (4) No return required if no IHT due and the event is de minimis — HMRC has issued guidance that very small trusts or trusts with very small charges may be able to use an informal reporting procedure rather than a full IHT100 form, but professional advice is needed to confirm this.
How is the ten-year anniversary charge calculated?
The ten-year anniversary charge (periodic charge) under IHTA 1984 ss.64–65 is calculated as follows: (1) Value the trust fund at the ten-year anniversary date — the market value of all relevant property in the trust at that date. (2) Add back hypothetical chargeable transfers — the settlor's cumulative chargeable transfers made in the 7 years before the settlement was created, plus the aggregate value of any related settlements made on the same day, plus the value of property that has left the trust since the last ten-year charge. (3) Apply the IHT rate — the effective rate of IHT is calculated as if the trust fund, with the added-back transfers, were the top slice of a hypothetical cumulative chargeable transfer at the date of the anniversary. The maximum effective rate is 30% of the standard 40% = 12%, but in practice most trusts are charged at far lower effective rates (typically 1.5%–6%) because the added-back figure and the nil-rate band interact to reduce the rate. (4) The periodic charge rate = effective rate × 30%.
What is an exit charge and when does it apply?
An exit charge arises when property leaves a relevant property trust — either because it is distributed to a beneficiary (outright or on a new trust) or because the trust assets cease to be relevant property. Exit charges are calculated under IHTA 1984 ss.65–69. The rate depends on when the exit occurs relative to the ten-year anniversary: (1) Exits before the first ten-year anniversary — the effective rate is calculated based on the settlor's cumulative chargeable transfers at the date of settlement, and is proportional to the number of complete quarters that have passed since the settlement was created. Maximum rate = 3% of the trust value leaving (30% of the 40% standard rate × 1/4 per quarter). (2) Exits after the first ten-year anniversary — the effective rate is based on the rate calculated at the most recent ten-year anniversary, multiplied by the number of complete quarters since that anniversary. No exit charge on: distributions to qualifying charities, distributions of excluded property, and distributions on the death of a beneficiary under a qualifying disabled trust.
What is the difference between IHT100 and IHT400?
IHT400 is the inheritance tax account filed on the death of an individual, reporting the deceased's estate — all assets and liabilities at the date of death — and calculating any IHT due on the death. It is filed by the executors or administrators as part of the probate process. IHT100 is filed by trustees of a relevant property trust to report chargeable events occurring within the trust during its lifetime (ten-year charges, exit charges) or on the death of a person with an interest in possession. Key differences: (1) Who files — IHT400 is filed by the personal representatives of the deceased; IHT100 is filed by the trustees. (2) When filed — IHT400 is filed at death; IHT100 is filed at each chargeable event. (3) What is reported — IHT400 reports the deceased's personal estate; IHT100 reports trust events. (4) Tax reference — the trust has its own HMRC Trusts tax reference (UTR) which is required for IHT100 filings. Some trust events appear in both returns: where a life tenant with a qualifying interest in possession dies, the trust property is treated as forming part of their estate — the trustees file IHT100c alongside the personal representatives' IHT400.
Are there any exemptions or de minimis thresholds for IHT100 reporting?
HMRC has confirmed that not every chargeable event requires a full IHT100 filing. Key exemptions and simplifications: (1) Excepted settlements — HMRC's Inheritance Tax (Delivery of Accounts) (Excepted Settlements) Regulations 2008 exempt certain small settlements from the requirement to file IHT100 at the ten-year anniversary, provided the trust fund value is below an agreed threshold (currently linked to the nil-rate band). (2) Excepted transfers and terminations — similar de minimis exemptions apply for exit charges and interest in possession terminations where the trust fund is small. (3) No IHT100 required where the effective rate of tax is 0% — where the ten-year rate calculation produces zero IHT (e.g., because the trust fund plus added-back transfers does not exceed the nil-rate band), no formal IHT100 is required, though trustees should keep records of their calculation. However, these exemptions are technical and the conditions must be precisely satisfied. Trustees who are uncertain whether an IHT100 is required should seek professional advice — late filing and failure to report can result in HMRC penalties and interest.
Understand the Costs of Your Will Trust
Discretionary will trusts come with ongoing IHT reporting obligations and compliance costs. Understanding the IHT100 regime helps you and your trustees plan properly. WillSafe’s DIY will kit helps you put a valid will in place; for discretionary trust structures, specialist tax and legal advice ensures your trustees understand their obligations from day one.
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