Reversionary interest

In trust law terms, a reversionary interest is an interest that reverts back to the settlor of a trust once a beneficiary's interest has come to an end. For example, Bob gives a life interest in Rose Cottage to his mother Judy, and on Judy's death the cottage is to revert back to Bob. Bob has a reversionary interest (also known as an interest in "reversion" or as a "reverter to settlor").

For inheritance tax purposes the meaning is wider, encompassing any remainder interest (see Practice note, Taxation of UK trusts: inheritance tax: Reversionary interests).