Inheritance Tax Act 1984 section 47

Reversionary interest

Section 47 defines what a "reversionary interest" means for inheritance tax purposes, covering future interests under settlements that may be either certain or conditional.

• A reversionary interest is a future interest under a settlement, meaning it is an interest that will or may come into effect at some point after the settlement is created.
• The interest can be either vested (where the right is fixed and certain, even though enjoyment is postponed) or contingent (where the right depends on a condition or event that may or may not occur).
• The definition extends to an interest that is expectant on the termination of an interest in possession, including where that interest in possession is treated as subsisting in only part of the settled property.
• In Scotland, the definition also covers an interest in the fee of property that is subject to a proper liferent, reflecting the equivalent Scottish legal concept.