Loss on sale of shares relief was introduced in the 1973 Finance
Act. The legislation is now found in IHTA84/S178 – 189.
What the relief does:
When someone dies any stocks and shares in the estate are
valued for inheritance tax (IHT) purposes at their date of death
value (
IHTM18011). But the price of shares can
vary dramatically and, if shares are sold in the year following the
death at an overall loss, relief may be available. In simple terms,
the relief allows for the sale price of the sold shares to be
substituted for their date of death values.
The basic conditions (
IHTM34011) for claiming the relief are
set out on the next page.
This relief does not apply to shares that are transferred in
the deceased’s lifetime. There are separate rules (
IHTM14621) for claiming relief when the
value of these shares fall.
