Where the transferor dies on or after 17 March 1987, the availability of instalments for tax on a PET ( IHTM04057) is governed by IHTA84/S227 and IHTA84/S228, as amended by IHTA84/S58 and FA87/S8. The general rule the amended sections contain is that instalments are not available unless both the following conditions are satisfied:
Notwithstanding the requirement detailed in the second bullet point instalments will still be available if the provisions of IHTA84/S113 A (6) are met.
A gives B a controlling interest in X Ltd, a quoted company. B retains the shares until A’s death.
The condition in IHTA84/S227 (1C) (a) is satisfied. Instalments are available.
A gives B a farm. The conditions for Agricultural Relief (AR) are satisfied at the time of the gift. B sells the farm and within a year reinvests all the proceeds in another farm. A then dies in 1991 and tax becomes payable. The replacement property rules for AR in S124B are satisfied.
The instalment facility is available since on A’s death the value transferred is reduced by AR in calculating the tax payable.
There is a further condition where the property transferred consists of unquoted shares or unquoted securities ( IHTM30242).