IHTM24162 - The District Valuer: Extent of agricultural property in the estate

Before referring the papers to the DV you will have identified the total extent of the agricultural property ( IHTM24030) in the estate. This is important because the extent of the agricultural property will have an effect on the question of whether any farmhouses, cottages or farm buildings are ‘of a character appropriate’ ( IHTM24050) to the agricultural land. The agricultural property in the estate may include property at other entries in which the deceased has a beneficial interest. ( IHTM04031) It may also include qualifying agricultural property on which spouse or civil partner exemption ( IHTM11032) is claimed but which nevertheless can be taken account of if the question of character appropriate is in point.

Where the IHT charge arises under IHTA84/S52 you should seek advice as necessary.

You need to advise the DV of all the agricultural property to which the deceased/transferor was entitled as at the date of death. For this purpose ‘property’ includes rights and interests of any description, and ’ land”‘ includes any estate, interest, easement, servitude or right in or over land.

You should include details of:

• land in hand,
• land subject to grazing and/or mowing licences, ( IHTM24073)
• any annual agricultural tenancies ( IHTM24210) held by the deceased or transferor, including those to a sole tenant,
• land farmed under a farm business tenancy, ( IHTM24240)
• land let away to a third party, whether under a farm business tenancy ( IHTM24240) or an annual agricultural tenancy ( IHTM24210) (but see paragraph below)
• grazing rights (but not grazing or mowing licences held by the deceased/transferor as these are not interests in property),
• interests in land held as an underlying asset of a company, provided the deceased or transferor was the controlling shareholder, and
• land held as underlying assets of a partnership of which the deceased/transferor was a partner.
• land not owned by the deceased but subject to the rights of a partnership of which the deceased/transferor was a member, where the partnership’s interest amounts to a protected tenancy or a farm business tenancy ( IHTM24240). Where the interest amounts to less you should seek the advice of Technical Group.

In every case you should send a copy plan of the land to the District Valuer.