IHTM25141 - Relevant Business Property:
Investigating Relevant Business Property
Business relief is due to the extent that the value transferred
by the transfer of value is attributable to "relevant business
property", IHTA84/S104 (1). When you investigate the detailed
provisions for business relief, you should start by considering if
the property transferred comes within one of the categories of
"relevant business property" in IHTA84/S105 (1).
For deaths and transfers on or after 6 April 1996, there are
seven categories of property which are capable of qualifying as
relevant business property. They are (broadly):
| Category | Rate of relief |
- property consisting of a business or
interest in a business (
IHTM25151)
| 100% |
- control holdings of unquoted securities (
IHTM25171) in a company
| 100% |
|
| 100% |
- control holdings of quoted shares (
IHTM25201) in a company
| 50% |
- land, buildings, machinery or plant (
IHTM25221) used by a company controlled
by the transferor or by a partnership of which the transferor was a
member
| 50% |
- settled land, buildings, machinery or
plant (
IHTM25241) in which the transferor had
an interest in possession and used in his business (This applies to
lifetime transfers only).
| 50% |
These rates of relief
- apply to deaths and chargeable transfers and
events on or after 6 April 1996, except where stated.
- include charges or further charges of IHT arising
on a death on or after that date in respect of lifetime transfers (
IHTM14000) of value made before that
date. However if the lifetime transfer was of unquoted shares in a
company (
IHTM25191) and the transfer was
chargeable when made, the higher relief introduced from 6 April
1996 applies only for the purpose of calculating the second tax
charge by reference to the transferor's death. The value for
cumulation remains as calculated at the time of the transfer by
reference to the rate of relief applying at that time.
