The Inheritance Tax Act 1984 makes a clear distinction between
liability and accountability (
IHTM10801). In this context liability
is liability for the payment of tax.
IHTA Part VII, beginning at IHTA84/S199, provides the rules stating who is liable to pay tax and the exceptions from and limitations on liability.
Under IHTA84/S205, except as otherwise provided, where under the Act two or more persons are liable for the same tax, each of them is liable for the whole.
There are three main categories of liability to pay tax
In all three of those sections, references to any property
include references to any property directly or indirectly
There are important supplementary provisions governing liability in special cases ( IHTM30121) and limitations on liability.
A person may be liable under more than one head of liability in relation to a particular transfer. It is important for you to consider a person's liability under all alternative heads in view of the possible impact of the limitation of liability provisions and the implications for accountability.
There are separate provisions limiting liability by lapse of time ( IHTM30461).
In no circumstances does the office seek to hold the Law Society liable for IHT payable either
Similarly the Law Society of Scotland is not regarded as liable
for any IHT payable in respect of grants made from the Scottish
Solicitors Guarantee Fund established by the Law Society of
Scotland under the Solicitors (Scotland) Act 1980 IHTA84/S43.
The same considerations apply in relation to grants made from the Compensation Fund by the Law Society of Northern Ireland under the Solicitors (NI) Order 1976.