This section provides relief where, for example, the personal
representatives sell the deceased’s shareholding on its own
when it had been valued on death as part of a larger holding,
because of, say, the related property provisions. Such claims are
rarely met in practice and it is essential that in any such case
you read Chapter 9 of the Inheritance Tax Manual IHTM09751. You
should note in particular that the revaluation as a lesser holding
is at the date of death.
Shares and Assets Valuation (SAV) is responsible for the
revaluation of any such property which was previously valued at the
death by SAV.
Where a claim for revaluation is made under s.176, the IHT
caseworker will refer the matter to SAV by memorandum stating the
shares sold, the date of sale, the gross price realised, whether
related or non-vested property has also been sold and if so details
of that sale. SAV may also be asked to advise whether the sale
meets the requirement in s.176(3)(b) that it was at arm's length
for a price freely negotiated at the time of the sale.
Valuers should be on the alert for any indication that any
other sale has taken place of shares which were part of the
deceased's 'estate' immediately before the death or which then
constituted related property. Should it appear that such a
transaction has taken place, reference should be made back to the
IHT caseworker to establish whether the 'qualifying sale' was made
in conjunction with the other sale - see Chapter 9 of the
Inheritance Tax Manual IHTM09757.
Where under this provision a shareholding, previously valued
as part of a control holding, is revalued as part of a minority
holding, any business relief in respect of the shares sold will
need to be reduced to the minority rate (for pre-6/4/96 deaths) and
any agricultural relief withdrawn (See Chapter 111 of this manual
SVM111000). The attention of the IHT
caseworker should be directed to this when the revised value is
notified.
| Additional Guidance: SVM150000 |
