IHTM25264 - Investment businesses: Building and construction companies

The rule excluding investment businesses ( IHTM25261) from business relief applies to businesses consisting wholly or mainly of dealing in land or buildings. However this restriction does not deny relief for shares in a company which

• at the time of the transfer
• is carrying on a genuine building and construction business holding a number of properties (e.g. houses or plots awaiting development) as stock in trade.

The focus is on the nature of the business at the time of the transfer. So, for example, a business which started as a house builder but which at the time of the transfer had not built any houses recently and was selling off its landbank would not quality for relief.