IHTM33181 - Calculating the loss on a sale of joint property: general

Where a share only of land is included in an estate but the whole of the property is sold, then the loss is worked out by

• deducting the loss on sale from the value of the entirety (that is the gross value without any discount for joint ownership), and
• then apportioning the resulting figure between the fractional shares without any discount for joint ownership.

Example

A trust fund comprises Greenacre which is valued immediately before the death at £40,000.

A ¼ share only is comprised in the deceased’s estate and the date of death value ( IHTM33100) allowing for a 10% discount for joint ownership is £9,000.

Two years after the death the land is sold for £30,000 and the value of the entirety of the property after relief becomes £30,000.

The sale value ( IHTM33073) of that part of the property comprised in the deceased’s estate is revised to £7,500 (that is £30,000 x ¼).

You should refer to TG any case where

• a share of land in the estate is sold to a person with an interest in another fractional share of that land, or
• the sale of the entirety was not in fact made by the appropriate person ( IHTM33050) as such (either alone or in conjunction with others) but by some other person, for example trustees under another title.