Our Lifestyle Trust 8 Lump Sum Payments into the Lifestyle Trust Assigning the ownership of the bond from the Settlor into the trust will be treated as making a gift for inheritance tax (IHT) purposes. As the trust is a discretionary trust, this will be a chargeable lifetime transfer (CLT) unless any exemptions are available to cover some of the gift. Any CLT into the Lifestyle Trust which would cause the Settlor to exceed their available IHT nil-rate band (NRB) * must be reported to HM Revenue & Customs (HMRC). The forms are available at www.gov.uk/government/collections/ inheritance-tax-forms * Available NRB is the current allowance, £325,000 (frozen until 2026) minus any CLTs made in the 7 years prior to the gift. The inheritance tax treatment of the Lifestyle Trust