The interest of a lessor in relation to a lease for life which is treated as a settlement is a reversionary interest (I5.701)1, but is not excluded property (even though it is a reversionary interest)2.
The lessor's interest under such a lease can still qualify as excluded property under the foreign property rules if the property subject to the lease is outside the UK, and either the person beneficially entitled to the interest is domiciled outside the UK3 (see I9.311) or the interest is comprised in a settlement made by a foreign domiciled settlor4 (see I9.332).
The reversion on a lease for life which is treated as a settlement is not like other reversionary interests which are not excluded property, because of the special rules for determining its value for IHT
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Web page updated on 17 Mar 2025 16:39