For individuals who own businesses or an interest in them, business property relief (BPR) is a valuable relief from inheritance tax (IHT). BPR potentially provides relief at 100% (or 50%) on ‘relevant business property’ (e.g. shares in an unquoted company carrying on an eligible activity). However, BPR is subject to certain conditions. Failure to satisfy… Read More »
The inheritance tax (IHT) exemption for ‘normal expenditure out of income’ is extremely generous. There is no fixed upper monetary limit; a transfer of value (e.g. a cash gift) is exempt to the extent that it satisfies the exemption conditions. Furthermore, a gift that satisfies the conditions is immediately free of IHT. This is a… Read More »
Owners of investment properties might sometimes like to gift an interest in a property (e.g., to adult children) but retain all the rental income. Their intention is generally to reduce the value of their estates for inheritance tax (IHT) purposes without affecting their standard of living. Do you have a reservation? The ’gifts with reservation’… Read More »
The family home is the most valuable asset in the death estates of many individuals and could trap some homeowners in the inheritance tax (IHT) net. Thankfully, a claim for the residence nil rate band (RNRB) is potentially available where the family home is ‘closely inherited’ (IHTA 1984, ss 8D-8M). The RNRB (£175,000 for 2022/23)… Read More »
Business property relief (BPR) offers inheritance tax (IHT) relief of 100% or 50% on a transfer of value attributable to ‘relevant business property’. For example, unquoted company shares potentially qualify for 100% BPR, subject to certain general restrictions where the company’s activities consist wholly or mainly of dealing in stocks or shares, land or buildings,… Read More »
Business property relief (BPR) is an important inheritance tax (IHT) relief. It shelters the value of eligible business property from IHT, at current rates of 100% or 50%. The most common categories are a business (or interest in a business) and unquoted company shares, which potentially attract BPR at 100%. Various conditions must be satisfied… Read More »
Business property relief (BPR) offers relief from inheritance tax (IHT) of 100% (or 50%) on a transfer of value which is attributable to ‘relevant business property’. Unfortunately, not all unquoted company shares qualify for BPR. Certain company activities make the shares ineligible for relief, such as dealing in stocks or shares, land or buildings, or… Read More »
Inheritance tax (IHT) business property relief (BPR) is available to business owners if certain conditions are satisfied. BPR (at the 100% rate) applies to ‘relevant business property’ including a business or interest in a business. Unfortunately, not every business potentially attracts BPR, such as where the business consists wholly or mainly of ‘making or holding… Read More »
The inheritance tax (IHT) allowance (or ‘nil rate band’) (£325,000 for 2022/23) is generally available to individuals. For married couples (and civil partnerships), the transferable nil rate band (TNRB) rules broadly allow claims for unused nil rate band of a deceased spouse (or civil partner) to be transferred to the survivor. The survivor’s nil rate… Read More »
Land and buildings (e.g., the family home) are often held in joint names, such as by spouses (or civil partners), or parent and offspring. When it comes to valuing an interest in a jointly-owned property for inheritance tax (IHT) purposes (e.g., on death), it is necessary to consider the valuation methodology. Disposing of a joint… Read More »