The Ten-Year Anniversary Charge
Written and reviewed by the Trust Tax Accountants editorial team. Last reviewed 22 August 2026.
- What is due
- Report and pay the ten-year anniversary charge on relevant property
- By when
- Every ten years from the date the trust was created
- If it is missed
- Interest runs on late inheritance tax, and trustees are personally liable
Almost every other trustee obligation is annual, so it gets noticed. This one arrives once a decade, which is exactly why it gets missed. A trust set up in 2016 met its first anniversary in 2026, and there may be nobody left involved who remembers the trust deed being signed.
This is what the charge is, when it falls, and why nobody can quote you a flat rate for it.
What the Charge Is
Trusts in the relevant property regime, which covers most discretionary trusts, face an inheritance tax charge on each ten-year anniversary of their creation. The charge is calculated on the net value of the relevant property held in the trust on the day before that anniversary, after deducting debts and any available reliefs.
The mechanism sits in section 64 of the Inheritance Tax Act 1984, and HMRC's guidance on trusts and inheritance tax sets out how it applies in practice. The statutory provision itself is short, which is misleading: the computation behind it is not.
Why Nobody Quotes You a Rate
You will see 6% attached to this charge in a lot of places. That figure is the maximum on property transferred out of a trust, and applying it to the anniversary charge as though it were a flat rate produces the wrong number in most cases.
The actual rate depends on the trust's own history and on the settlor's: what the settlor had already given away in the seven years before creating the trust, what has come out of the trust since, and how much of the nil-rate band is available to it. Two trusts holding identical assets on the same anniversary can face materially different charges.
That is not a reason to panic about it. It is a reason to have the computation done rather than estimated, and to have it done before the anniversary rather than after, because the valuation date is fixed and there is no way to revisit it later.
Exit Charges Sit Alongside It
The other half of the regime catches property leaving the trust: when the trust ends, when assets are distributed to a beneficiary, or when a beneficiary becomes absolutely entitled to something. Inheritance tax on property transferred out of a trust is charged at up to 6%.
The two interact. What has left the trust affects the anniversary computation, and what happened at the last anniversary affects the exit charges after it. Treating either in isolation is how trustees end up with a figure that does not reconcile.
What We Do
Work out when the anniversary actually falls, which is not always the date people assume, value the relevant property at the right date, and prepare the computation and the reporting. Where an anniversary has already passed unreported we deal with that rather than leaving it.
For trusts we act for on the annual return, the anniversary is tracked from the start, so it is a diary entry rather than a discovery. What that costs is on the engagement page.