ABSTRACT
Baroness Kludge of Longton is a wealthy Staffordshire businesswoman aged 60. In order to try to reduce the amount of inheritance tax payable in the event of her death, she has made a number of transactions. One involves gifts of three of her country estates. The first, an estate in Shropshire, worth £150,000, was donated to ‘Save our Frogs’, a local charity, for the purpose of rearing endangered amphibians. The second, an estate in Stafford, worth £120,000, was given to the Staffordshire Bugle, a local newspaper, which had employed her grandfather 60 years ago. The third, worth £100,000, was given to Lancelot, her butler of many years. She has an agreement with Save our Frogs and the Staffordshire Bugle to lodge in the relevant estates whenever she is ‘in the area’. She has also made a gift of her house in London, worth £450,000, to her estranged husband, Baron Kludge, ‘in appreciation of the good times we had together’, and a gift of £2,000 to James Kludge, the Baron’s 16 year old son from a previous marriage, who she is very fond of. After two years of desperate effort, her estate agents have recently managed to dispose of her mansion in the Welsh valleys, worth £200,000, for a sum of £125,000. They had just succeeded in convincing her that, given the ‘slowness of the housing market and current interest rates’, it was impossible to obtain a higher price.
