In Scotland, the rule that a debt is situated where the debtor
resides applies alike to specialty (IHTM27078) debts and to those
due on simple contract. For Inheritance Tax purposes debts due from
persons resident in Scotland are regarded as locally situated
there. If any difficulty arises in applying this rule, refer the
case to TG.
Any case where a Scottish instrument under seal is outside
the UK and the locality of the asset determines whether or not an
allowance under IHTA84/S159 is admissible must also be referred to
TG for consideration.
This direction relates to specialty debts generally. It
covers, for example, mortgages under seal, policies under seal, and
covenant debts, and also applies to debts due from the Crown, or
due under a statute.
