What is the rate of the proportionate charge before the first ten-year anniversary?
There are special rules when the proportionate charge occurs before the first ten-year anniversary of a trust set up after 26 March 1974. The rate of tax is a fraction of a rate calculated on the value of • all the property in the trust at the time of its creation • any property subsequently added to the trust, and • any other property in any other trust made by the settlor on the same day. The cumulative total of the settlor’s chargeable transfers in the seven years before the setting up of the trust is also added to the calculation. This rate is worked out in the same way as the rate of the ten-yearly charge.
