39 Gift subject to power of revocation

If a person makes a gift of property to a donee but reserves to himself/herself the power to revoke the gift, this section treats the property as remaining in the disponer until he/she releases the power of revocation, or until he/she dies (at which stage the power of revocation lapses). In that case, the donee will be taxed as becoming beneficially entitled in possession. If, during the period between the original disposition and the release or lapse of the power of revocation, the donee has the free use of the property, he/she will be taxed as receiving a gift under section 40 in each year of the value of the use of the property for that year.

Relevant Date: Finance Act 2015