Sisters lose out in inheritance tax battle

A pair of co-habiting elderly sisters has been told by the European court of human rights they have not been discriminated against under UK inheritance tax (IHT) regulations.

The sisters had claimed that they should be entitled to the same IHT allowances as a married or civil partnership couple.

However, the court ruled that the sisters' living arrangements were "fundamentally different" to other couples' because of the absence of a legally-binding contract between the two women.

In a statement, Joyce and Sybil Burden said that they were "bitterly disappointed" and have found themselves "in a worrying and unsettling position of being unable to secure each other in our last few years".

Advice on IHT regulations and planning is available from solicitors in Northern Ireland.

IHT is liable at a rate of 40 per cent on any value of an estate over £312,000.

Because they are not legally defined as a couple, the Burden sisters will have to sell their £900,000 home in order to pay the IHT bill when one of them dies.

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