IHTM38121 - Land charges: introduction

Under IHTA84/S237, where tax or interest is unpaid for the time being and

• such tax has been charged on the value transferred by a chargeable transfer ( IHTM04027) and
• the value transferred is wholly or partly attributable to the value of any particular property

then such property has imposed upon it an HMRC charge for the tax unpaid.

Historically, an HMRC charge could be attached to settled property ( IHTM16000), joint property passing by survivorship ( IHTM15000), taxable lifetime gifts ( IHTM14000) and free estate realty.

The free/personal estate in the UK was not subject to the HMRC charge. For this purpose, personal estate was defined as including leasehold property and undivided shares in land IHTA84/S237 (3).

However, two changes in legislation have extended our powers in this area.

The Trusts of Land and Appointment of Trustees Act 1996 extended the definition of "land" to include any interest in land held in the free estate as tenants in common.

Consequently with effect from 1 January 1997, a notice of the HMRCs charge can be registered under IHTA84/S237.

For deaths occurring on or after 9 March 1999, FA99/S107 extended the charge for tax to leasehold property in the free estate.