Routier and Another -v- Revenue and Customs - ChD - 18-Sep-2014 - Rose DBE J (Bailii,  EWHC 3010 (Ch)) - Inheritance Tax - Charity - International
Executors appealed against rejection of their claim that a gift in the will qualified for relief against Inheritance Tax as being a charitable gift. The Trusts concerned assets in Jersey.
Held: The appeal failed: "The expression 'held on trust for charitable purposes' in section 23(6) requires not only that the charitable purposes be UK law charitable purposes but that the relevant trust be subject to the jurisdiction of the United Kingdom courts as well."
The reasoning of the Court of Appeal in Dreyfus applies to the wording of section 23 of the IHTA. The Coulter Trust did not qualify for exemption under either limb of subsection (6) because it was not governed by United Kingdom law but by Jersey law: "The Appellants have not put forward any good reason why Parliament should have intended that the second limb of section 23 should be so much broader than the first, encompassing trusts governed by foreign law but limited to charitable bodies established under UK law. Another important plank in the reasoning of the Court in Dreyfus was that the distinction drawn between the first limb of section 37 (namely income of any body of persons or trust established for charitable purposes) and the second limb of section 37 (namely income which according to the rule established by deed of trust or will are applicable to charitable purposes only) was intended only to distinguish between income held by bodies which are exclusively charitable on the one hand and bodies which are not exclusively charitable but which hold the relevant income for exclusively charitable purposes on the other. It was not intended to be a difference beyond that, allowing a much wider geographic range of bodies to fall within the second limb than could fall within the first. "
Inheritance Tax Act 1984 s. 23
Camille and Henry Dreyfus Foundation Inc -v- Inland Revenue Commissioners CA 1954 ( 1 Ch 672)
Camille and Henry Dreyfus Foundation Inc -v- Inland Revenue Commissioners HL 1956 ( AC 39,  3 All ER 97, 36 TC 126)
HM Inspector of Taxes -v- Dextra Accessories Ltd HL 7-7-2005 (Bailii,  UKHL 47, Times 11-Jul-05, House of Lords,  STC 1111)