188体育

Under these arrangements the settlor creates a trust which holds a single premium bond. The trust is made up of separate funds, often referred to as the 鈥榬etained鈥� fund and the 鈥榞ifted鈥� or 鈥檅eneficiaries鈥欌€� fund.

The retained portion is held for the settlor absolutely and remains part of the settlor鈥檚 estate. The gifted portion is usually held on flexible trusts for the chosen beneficiaries. The settlor makes a transfer of value equal to the gifted portion when the trust is created.

During the settlor鈥檚 lifetime the settlor is able to take withdrawals from the bond up to the value of their interest. Each withdrawal has the effect of reducing the settlor鈥檚 retained portion, so it is unusual on death for the retained portion to be the same as it was at the outset.

The settlor can only receive any benefit, or withdrawals, from the retained fund which has been carved out of the property gifted. This arrangement is therefore not a gift with reservation (IHTM14301).