IHTM25012 - Investigating business relief and businesses: Reviewing form IHT413 or D38
You should start your investigation by looking at the
information on form IHT413 or D38, then check if 100% business
relief (
IHTM25021) applies.
Form IHT413 is one of the supplements to form IHT400. It
gives details of the business or partnership interest included in
the deceased’s estate and provides information to support the
taxpayer’s claim for business relief.
Form D38 is used instead of the IHT413 if the business or
partnership interest was an asset of a trust or included in a
lifetime transfer.
Both forms are designed to obtain the information you need
to establish whether 100% business relief is available in
straightforward cases, and to establish the value of the business
interest if 100% relief is not due. The information they contain
may also be used to investigate a claim for business relief at 50%.
Box 1
tells you if the business interest was owned for the
two-year period required by the ownership test (
IHTM25301).
If the answer at box 1 is no you should check the rules for
the test (
IHTM25301) as the 2- year ownership
requirement is relaxed in certain circumstances.
Boxes 2 to 6
Business relief is not normally available for a business
interest that is subject to a binding contract for sale (
IHTM25291).
Boxes 7 to 17
Identifies the business or interest in a business. The
answers given should provide information to establish whether the
business interest is relevant business property (
IHTM25141). This will tell you if it is
the type of business interest which is capable of qualifying for
business relief. If 100% business relief is not due, the
information provided is needed in valuing the business interest.
Boxes 18 to 21Provides information needed to value
a business interest on which 50% business relief is claimed, and to
investigate the claim for relief.
Boxes 22 to 24These questions will only be
answered if business relief is being deducted against
- a potentially exempt transfer ( IHTM04057) that is chargeable by reason of the death, or
- a lifetime transfer that was immediately chargeable ( IHTM04067) where additional tax is payable as a result of the death.
These transfers are subject to additional conditions ( IHTM25361) for business relief.
