Business property relief (BPR) | Croner-i Tax and Accounting

– see also Inheritance tax

Accruer arrangements, partnerships

Legislation/Regulatory – Misc. 114

Agricultural property relief, interaction with

Commentary – Tax Reporter ¶660-250 ; Tax Reporter ¶660-850 ; Tax Reporter ¶666-200

HMRC Guidance – IHTM24151

Agricultural property, avoidance of double relief

Legislation/Regulatory – IHTA84 s. 114(1)

HMRC Guidance – IHTM24151 ; IHTM24180 ; IHTM25121 ; IHTM30214

Amount of reduction

Legislation/Regulatory – IHTA84 s. 104

HMRC Guidance – IHTM25141

Assets not used in business

Legislation/Regulatory – IHTA84 s. 112

HMRC Guidance – IHTM25263 ; IHTM25341 ; IHTM25351 ; IHTM25353 ; IHTM25354 ; IHTM27264 ; IHTM30214 ; IHTM42965 ; SVM111230

Attribution of value transferred

Legislation/Regulatory – IHTA84 s. 39A

Availability of relief

Legislation/Regulatory – IRInt. 1002

Bookmaker's pitch

Commentary – Tax Reporter ¶664-250

HMRC Guidance – IHTM25152

Case Law – Farmer & Anor (Executors of Frederick Farmer dec'd) v IR Commrs ; Grimwood-Taylor & Anor (as Executors of the Will of Mallender dec'd) v IR Commrs

Bookmakers pitches

Legislation/Regulatory – IRInt. 1008

Business consisted mainly of making and/or holding of investments

Case Law – Green [2015] TC 04519

Business or an interest in a business, relevance

Commentary – Tax Reporter ¶664-300

HMRC Guidance – IHTM25152

Case Law – McGregor (H.M. Inspector of Taxes) v. Adcock

Business property entitled

Legislation/Regulatory – IHTA84 s. 105

HMRC Guidance – IHTM24151 ; IHTM24204 ; IHTM25107 ; IHTM25121 ; IHTM25141 ; IHTM25152 ; IHTM25171 ; IHTM25172 ; IHTM25191 ; IHTM25192 ; IHTM25202 ; IHTM25221 ; IHTM25222 ; IHTM25223 ; IHTM25224 ; IHTM25225 ; IHTM25226 ; IHTM25227 ; IHTM25241 ; IHTM25242 ; IHTM25243 ; IHTM25250 ; IHTM25251 ; IHTM25261 ; IHTM25264 ; IHTM25271 ; IHTM25274 ; IHTM25275 ; IHTM25314 ; IHTM25354 ; IHTM25365 ; IHTM25383 ; IHTM30213 ; IHTM30214 ; IHTM42965 ; LLM8290 ; LLM8300

Buy and sell agreements

Commentary – Tax Reporter ¶665-050

Caravan parks

Case Law – Furness v IR Commrs (1999) Sp C 202 ; George & Anor (Executors of Stedman, dec'd) v Inland Revenue Commissioners. [2004] BTC 8,003 ; Hall (Executors of Hall dec'd) v IR Commrs (1997) Sp C 114 ; Inland Revenue Commissioners v George & Anor (Executors of Stedman, dec'd). [2003] BTC 8,037 ; Powell & Anor (Executors of Pearce dec'd) v IR Commrs (1997) Sp C 120 ; Weston (as Executor of the Will of Weston Deceased) v Inland Revenue Commissioners. [2000] BTC 8,041

Caravan parks/mobile homes sites

Commentary – Tax Reporter ¶664-400

Case Law – THE COMMISSIONERS OF INLAND REVENUE v. THE KOREAN SYNDICATE, LTD.

Cash held for future trading purpose, excluded assets

Case Law – Barclays Bank Trust Co Ltd v IR Commrs (1998) Sp C 158

Claims for relief

Commentary – Tax Reporter ¶664-100

Commencement/cessation of trade

Commentary – Tax Reporter ¶202-500

Contracts for sale, assets/business

Legislation/Regulatory – IHTA84 s. 113 ; Misc. 117 ; SP 12/80

HMRC Guidance – IHTM25291 ; IHTM25292 ; IHTM30241 ; IHTM30282 ; SVM111120

Controlling shareholding in quoted company

Commentary – Tax Reporter ¶664-600

Case Law – (1) THE COMMISSIONERS OF INLAND REVENUE v. B.W. NOBLE LTD. (2) B.W. NOBLE, LTD. v. THE COMMISSIONERS OF INLAND REVENUE. ; Executors of the Will of Mrs Fanny Walker dec'd v IR Commrs

Dealers in land/buildings

Legislation/Regulatory – IHTA84 s. 105(3)

HMRC Guidance – IHTM25094 ; IHTM25261 ; IHTM25262 ; IHTM25263 ; IHTM25265 ; IHTM25271 ; IHTM25273 ; IHTM25274 ; IHTM25275 ; IHTM25276 ; IHTM25277 ; IHTM25279 ; IHTM30216 ; IHTM30313 ; IHTM30363 ; IHTM37093 ; IHTM42965 ; SVM111140 ; SVM111180

Deceased shareholder's controlling interest

Case Law – Walding & Ors v Inland Revenue Commissioners. [1996] BTC 8,003

Discount houses

Legislation/Regulatory – IHTA84 s. 105(4A) ; SI 2012/2903 reg. 6, 7

Double relief, avoidance of

Legislation/Regulatory – IHTA84 s. 114

HMRC Guidance – IHTM28022

Excepted assets

Legislation/Regulatory – IHTA84 s. 112

Excepted assets in valuation

Commentary – Quick Overview ¶16825

Excluded assets

Legislation/Regulatory – IHTA84 s. 105(6), 113

HMRC Guidance – IHTM25224 ; IHTM25242 ; IHTM25261

Excluded businesses

Commentary – Quick Overview ¶16805

Legislation/Regulatory – IHTA84 s. 105(3), 113

Excluded shares/securities

Legislation/Regulatory – IHTA84 s. 105(2)

Financial institutions

Legislation/Regulatory – FA86 s. 106(4)-(8) ; SI 2012/2903 reg. 6, 7

Furnished holiday letting business

Case Law – Green [2015] TC 04427

Generally

Commentary – Quick Overview ¶16800 ; Tax Reporter ¶664-000 ; Tax Reporter ¶664-050

Gifts of business assets

Commentary – Tax Reporter ¶575-250

Gifts subject to reservation

Commentary – Tax Reporter ¶614-400 ; Tax Reporter ¶666-100

Gifts with reservation

Commentary – Quick Overview ¶16270

Legislation/Regulatory – FA87 s. 58

Group of companies, shareholdings in

Case Law – Grimwood-Taylor & Anor (as Executors of the Will of Mallender dec'd) v IR Commrs (1999) Sp C 223

Holding companies

Legislation/Regulatory – IHTA84 s. 105(4)(b)

HMRC Guidance – IHTM25262 ; IHTM25263 ; IHTM30216

Holiday letting business, deceased's share of property

Case Law – Revenue and Customs Commissioners v Lockyer & Anor (personal representatives of Pawson dec'd). [2013] BTC 1,605

Inheritance tax

Case Law – Personal Representatives of Graham (deceased) [2018] TC 06536

Interaction with other reliefs

Agricultural

Legislation/Regulatory – IHTA84 s. 114(1)

Generally

Commentary – Quick Overview ¶16830

Woodlands

Legislation/Regulatory – IHTA84 s. 114(2)

Interaction with other reliefs and exemptions

Agricultural property relief

Commentary – Tax Reporter ¶660-250 ; Tax Reporter ¶660-850 ; Tax Reporter ¶666-200

HMRC Guidance – IHTM24151

Exempt/partly-exempt transfers

Commentary – Tax Reporter ¶666-300

National heritage property

Commentary – Tax Reporter ¶666-350

Woodlands

Commentary – Tax Reporter ¶666-250

Investment businesses

Legislation/Regulatory – IHTA84 s. 105(3)

Land used for company business, voting power

Case Law – Executors of the Will of Mrs Fanny Walker dec'd v IR Commrs (2001) Sp C 275

Leasing buildings and land to tenants

Case Law – Farmer & Anor (Executors of Frederick Farmer dec'd) v IR Commrs (1999) Sp C 216

Letting property

Commentary – Tax Reporter ¶664-400 ; Tax Reporter ¶664-450

Case Law – THE COMMISSIONERS OF INLAND REVENUE v. THE KOREAN SYNDICATE, LTD.

Lloyd's name

Case Law – Hardcastle & Anor v IR Commrs (2000) Sp C 259 ; Mallender (executors of the will of Captain Patrick John Boteler Drury-Lowe deceased) v Inland Revenue Commissioners. [2001] BTC 8,013

Lloyd's underwriters

Commentary – Tax Reporter ¶664-850

HMRC Guidance – LLM8300

Case Law – Hardcastle & Anor v IR Commrs

Making or holding investments

Case Law – Best (Executor of the Estate of Buller dec'd) [2014] TC 03217 ; C J Burkinyoung (Executor of Burkinyoung dec'd) v IR Commrs (1995) Sp C 3 ; Clark & Anor (Exors of Clark dec'd) v. R & C Commrs (2005) Sp C 502 ; Farmer & Anor (Executors of Frederick Farmer dec'd) v IR Commrs (1999) Sp C 216 ; Grimwood-Taylor & Anor (as Executors of the Will of Mallender dec'd) v IR Commrs (1999) Sp C 223 ; Hall (Executors of Hall dec'd) v IR Commrs (1997) Sp C 114 ; Martin & Anor (Executors of Estate of Moore dec'd) v IR Commrs (1995) Sp C 2 ; McCall & Anor (Personal Representatives of McClean dec'd) v. R & C Commrs (2008) Sp C 678 ; McCall & Anor (personal representatives of McClean, deceased) v Revenue and Customs Commissioners. [2009] BTC 8,059 ; Phillips & Ors v. R & C Commrs (2006) Sp C 555 ; Piercy v. R & C Commrs (2008) Sp C 687 ; Revenue and Customs Commissioners v Brander (Balfour's Executor). [2010] BTC 1,656

Market makers

Legislation/Regulatory – IHTA84 s. 105(4) ; SI 2012/2903 reg. 6, 7

Meaning of a business

Commentary – Tax Reporter ¶664-250

HMRC Guidance – IHTM25152

Case Law – Farmer & Anor (Executors of Frederick Farmer dec'd) v IR Commrs ; Grimwood-Taylor & Anor (as Executors of the Will of Mallender dec'd) v IR Commrs

Minimum period of ownership

Commentary – Quick Overview ¶16810

Minority holdings of unquoted shares

Commentary – Tax Reporter ¶664-650

HMRC Guidance – IHTM18331

Nature of property and rate of relief

Commentary – Key Data ¶8-260

Ownership, minimum period

Property, replacements

Commentary – Tax Reporter ¶665-550 ; Tax Reporter ¶665-600

HMRC Guidance – CG60270 ; IHTM24113 ; IHTM25311 ; IHTM25313

Case Law – Vinton & Anor (Executors of Dugan-Chapman dec'd) v. R & C Commrs

Second transfer within two years

Commentary – Tax Reporter ¶665-600

Successions

Commentary – Tax Reporter ¶665-600

Two-year requirement

Commentary – Tax Reporter ¶665-500

HMRC Guidance – IHTM25302 ; IHTM25303

Unquoted shares in a company

Commentary – Tax Reporter ¶665-550

HMRC Guidance – CG60270 ; IHTM24113 ; IHTM25311 ; IHTM25313

Case Law – Vinton & Anor (Executors of Dugan-Chapman dec'd) v. R & C Commrs

Ownership, minimum period of

Deemed two year

Legislation/Regulatory – IHTA84 s. 107(1)

HMRC Guidance – IHTM24114 ; IHTM25310

Partly exempt transfers

Legislation/Regulatory – IHTA84 s. 39A

Partnership changes disregarded

Legislation/Regulatory – IHTA84 s. 107(3)

HMRC Guidance – IHTM25313

Replacement of business property

Legislation/Regulatory – IHTA84 s. 107(1)

Legislation/Regulatory – IHTA84 s. 107(4)

HMRC Guidance – IHTM25314

Succession

Legislation/Regulatory – IHTA84 s. 108, 109

HMRC Guidance – IHTM22023 ; IHTM25321 ; IHTM25331 ; IHTM25333

Transfers between spouses

Legislation/Regulatory – IHTA84 s. 108, 109

Transfers on death

Legislation/Regulatory – IHTA84 s. 108, 109

Two-year requirement

Legislation/Regulatory – IHTA84 s. 106

HMRC Guidance – IHTM25107 ; IHTM25224 ; IHTM25301 ; IHTM25303 ; IHTM30216 ; IHTM42965 ; LLM8300

Partnerships

Accruer arrangements

Legislation/Regulatory – Misc. 114

Buy and sell agreements

Commentary – Tax Reporter ¶665-050

Buy or sell agreements

Legislation/Regulatory – Misc. 117

Changes

Legislation/Regulatory – IHTA84 s. 107(3)

Property of transferor used by

Commentary – Tax Reporter ¶664-750

HMRC Guidance – IHTM25222

Transfer of assets

Commentary – Tax Reporter ¶665-300

Personal use of asset

Legislation/Regulatory – IHTA84 s. 112(6)

HMRC Guidance – IHTM25353

Potentially exempt transfers

Conditions for relief

Legislation/Regulatory – FA96 s. 184(6) ; IHTA84 s. 113A

Replacement property

Legislation/Regulatory – FA94 s. 247(3) ; IHTA84 s. 113B

Property excluded from relief

Assets not used in business

– see Assets not used in business

Buy and sell agreements

Commentary – Tax Reporter ¶665-050

Contract for sale of specific assets

Commentary – Tax Reporter ¶665-000

Contract for sale, property subject to

Commentary – Tax Reporter ¶665-000

Dealers in land/shares

Commentary – Tax Reporter ¶664-950

HMRC Guidance – IHTM25265 ; IHTM25266 ; IHTM25273 ; IHTM25277

Case Law – COMMISSIONERS OF INLAND REVENUE v. DESOUTTER BROS., LTD. ; COMMISSIONERS OF INLAND REVENUE v. TOOTAL BROADHURST LEE CO., LTD. ; Executors of Brown dec'd v IR Commrs ; Farmer & Anor (Executors of Frederick Farmer dec'd) v IR Commrs ; Phillips & Ors v. R & C Commrs ; THE COMMISSIONERS OF INLAND REVENUE v. THE GAS LIGHTING IMPROVEMENT CO., LTD.

Groups of companies

Commentary – Tax Reporter ¶664-950

HMRC Guidance – IHTM25265 ; IHTM25266 ; IHTM25273 ; IHTM25277

Shares in company in liquidation

Commentary – Tax Reporter ¶665-100

Wholly or mainly, meaning

Commentary – Tax Reporter ¶664-950

HMRC Guidance – IHTM25265 ; IHTM25266 ; IHTM25273 ; IHTM25277

Property of transferor used by company/partnership

Commentary – Tax Reporter ¶664-750

HMRC Guidance – IHTM25222

Property qualifying for relief

Commentary – Tax Reporter ¶664-150

Property subject to a reservation

Legislation/Regulatory – FA86 Sch. 20, para. 8

Ragley Hall historic house opening to the public

Case Law – Seymour et al v IR Commrs (2004) Sp C 444

Rates of tax

Legislation/Regulatory – IHTA84 s. 104

Relevant business property

Legislation/Regulatory – IHTA84 s. 105

Case Law – Fetherstonhaugh & Ors. v. Inland Revenue Commissioners. [1984] BTC 8,046 ; Finch and Others v. Inland Revenue Commissioners. [1983] BTC 8,003 ; Martin & Anor (Executors of Estate of Moore dec'd) v IR Commrs (1995) Sp C 2 ; McCall & Anor (personal representatives of McClean, deceased) v Revenue and Customs Commissioners. [2009] BTC 8,059 ; Trustees of Nelson Dance Family Settlement v. R & C Commrs (2008) Sp C 682 ; Trustees of the Nelson Dance Family Settlement v Revenue and Customs Commissioners. [2009] BTC 8,003

Relevant business property, categories of

Commentary – Tax Reporter ¶664-200

Replacement property

Case Law – Brander, Representative of James (Earl of Balfour) [2009] TC 00069 ; Revenue and Customs Commissioners v Brander (Balfour's Executor). [2010] BTC 1,656

Retired partner retaining interest in business

Case Law – Beckman v IR Commrs (2000) Sp C 226

Settled property

No qualifying interest in possession

Commentary – Tax Reporter ¶364-100

Qualifying interest in possession

Commentary – Tax Reporter ¶363-100 ; Tax Reporter ¶363-800

HMRC Guidance – IHTM42224

Used in life tenant's business

Commentary – Tax Reporter ¶363-050 ; Tax Reporter ¶664-800

HMRC Guidance – IHTM25154

Settlement of shares followed by purchase of own shares, associated operations

Case Law – Reynaud & Ors v IR Commrs (1999) Sp C 196

Shares allotted two days prior to death

Case Law – Vinton & Anor (Executors of Dugan-Chapman dec'd) v. R & C Commrs (2008) Sp C 666

Single payment scheme

Legislation/Regulatory – TBSE6/05

Specific gifts

Case Law – Russell & Anor. v. Inland Revenue Commissioners. [1988] BTC 8,041

Successive transfers

Legislation/Regulatory – IHTA84 s. 109

Tax burden, allocation among beneficiaries

Commentary – Tax Reporter ¶630-950

Transfer between spouses

Legislation/Regulatory – IHTA84 s. 108, 109

Transfers within seven years before death

Company reconstructions

Commentary – Tax Reporter ¶665-900

Controlling shareholdings, special provisions

Commentary – Tax Reporter ¶665-700

HMRC Guidance – IHTM25366 ; IHTM25368

Death of transferee before transferor

Commentary – Tax Reporter ¶665-750

Generally

Commentary – Quick Overview ¶16815 ; Tax Reporter ¶612-050 ; Tax Reporter ¶665-700

Legislation/Regulatory – FA96 s. 184(6) ; IHTA84 s. 113A

HMRC Guidance – IHTM25366 ; IHTM25368

Incorporation of business

Commentary – Tax Reporter ¶665-950

Part only property qualifying

Commentary – Tax Reporter ¶665-800

Practical considerations

Commentary – Tax Reporter ¶665-850

Replacement of property

Commentary – Tax Reporter ¶666-000

HMRC Guidance – IHTM25369

Replacement property

Legislation/Regulatory – FA94 s. 247(3) ; IHTA84 s. 113B

Transfers within three years before death

Legislation/Regulatory – IHTA84 s. 131(2A)

Unquoted shares and securities

Commentary – Tax Reporter ¶664-600

Case Law – (1) THE COMMISSIONERS OF INLAND REVENUE v. B.W. NOBLE LTD. (2) B.W. NOBLE, LTD. v. THE COMMISSIONERS OF INLAND REVENUE. ; Executors of the Will of Mrs Fanny Walker dec'd v IR Commrs

Unquoted shares, period of ownership of

Legislation/Regulatory – IHTA84 s. 107(4)

Valuation

Commentary – Quick Overview ¶16820 ; Quick Overview ¶16825

Value of business

Excepted assets

Legislation/Regulatory – IHTA84 s. 112

Generally

Legislation/Regulatory – IHTA84 s. 110

HMRC Guidance – IHTM25121 ; IHTM25153 ; IHTM25250 ; IHTM25341 ; IHTM25342 ; IHTM28020 ; IHTM28393 ; IHTM30214 ; LLM8290

Personal use of asset

Legislation/Regulatory – IHTA84 s. 112(6)

Value of shares/securities

Legislation/Regulatory – IHTA84 s. 111

HMRC Guidance – IHTM25263

Winding-up commenced

Legislation/Regulatory – IHTA84 s. 105(5)

Woodlands, relief on disposal

Credit against tax on disposal

Commentary – Tax Reporter ¶653-500

Interaction with

Commentary – Tax Reporter ¶653-450