IHTM14011 - Basis of valuation: summary

The general rule under IHTA84/S3 is that the value transferred by a transfer of value ( IHTM04024) is the

• amount by which the value of the transferor’s estate is reduced (the loss to the estate principle) ( IHTM04054). See also IHTM04093 and IHTM04094 for the position on the termination of a life interest during the life tenants lifetime.
• but taking no account of any excluded property ( IHTM04251) which ceases to form part of the transferor’s estate as a result.

The loss does not depend only on the property owned by the transferor. You must consider also other property in the transferor’s estate, such as settled property ( IHTM04081) or related property ( IHTM09731).