Readers’ forum: Does gift on death create reservation of benefit?

My clients are a retired couple. The husband is 67 and in poor health. The wife is 64 and healthy. For historical reasons their principal private residence was transferred into the sole ownership of the wife some years ago. They are now considering some estate planning.

Should the wife die first and leave say a half share in the marital home to her adult children with the other half to her husband with his right of continuing occupation on a rent-free basis does this create a reservation of benefit in respect of the half share which continues to be occupied by the husband although it is actually owned legally by the two adult children who do not live there?

An alternative suggestion is for the wife to transfer a half share of the home to the husband now inter vivos and in the event...