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Permanent Magnet Synchronous Motors (PMSMs) are now extensively used in many critical applications. There is an increasing need for the motor and control system to have fault tolerant capabilities. This paper presents a fault tolerant control strategy to operate the PMSM during inter-turn fault conditions. The proposed technique combines the Model Predictive Control (MPC) for the speed and current control loops, and an almost error-free Unscented Kalman Filter (UKF) to estimate the PMSM inter-turn fault ratio. The PMSM state-space model for healthy and faulty conditions will be presented. Also, the equations and the remedial action of the MPC and UKF are provided in detail. The proposed algorithm is applied to PMSM model as a case study with a range of simulation analysis and discussion of results.