At the date of death the deceased owned qualifying investments in four companies, A, B, C and D plc. The personal representatives sold all the shares within 12 months of the death. The values on death and at the date of sale, together with the losses or gains made are shown in the table below
| Qualifying investments | Value on death | Sale value | Gain/(loss) |
| 2,000 shares in ‘A’ | £2,000 | £1,600 | (£400) |
| 1,500 shares in ’B’ | £2,200 | £2,400 | £200 |
| 1,000 shares in ‘C’ | £5,000 | £4,000 | (£1,000) |
| 500 shares in ‘D’ | £2,000 | £2,000 | Nil |
|
£11,000 |
£10,000 |
(£1,200) |
The personal representatives purchased £5,000 of qualifying
investments in the period between the date of death and two months
after the date of the last sale.
Because of IHTA84/S180 the loss on sale is reduced by the
‘relevant proportion’ (
IHTM34212)
| £5,000 | x 1,200 | = £600 |
| £10,000 |
The loss on sale relief is therefore reduced to £600
(£1,200 - £600).
The revised value of the shares in ‘A’ is
£1,600 plus an amount equal to the ‘relevant
proportion’ of the difference between the value on death and
the sale price, which is £1,600 + [(£5,000/£10,000)
x £400] = £1,800.
The revised value of the shares in ‘B’ is
£2,400 less an amount equal to the ‘relevant
proportion’ of the difference between their value on death
and the sale price, which is £2,400 –
[(£5,000/£10,000) x £200] = £2,300.
The revised value of the shares in C is £4,500,
calculated in a similar way as for A. There is no change in the
sale price for D.
