This guidance note provides a background to the basic principles of IHT, including the loss to the donor principle, chargeable transfers and transfers that are not subject to inheritance tax.
Inheritance tax is a tax on the value passing from one individual to another person. This typically arises when an individual dies and all of the property that they own (their ‘estate’) passes to beneficiaries. An individual may also transfer their assets to others during lifetime. This could be an outright gift of assets to another person or a gift into trust.
Assets in trust are held by trustees for the benefit of others, whose entitlement to them is restricted in some way. Special inheritance tax rules apply to trusts to reflect the separation of legal and beneficial ownership.
IHT arising on a death estate is a tax on the donor ― the person who is transferring the asset. It is calculated with reference to their estate. It is not a tax on the beneficiaries,
**Free trials are only available to individuals based in the UK, Ireland and selected UK overseas territories and Caribbean countries. We may terminate this trial at any time or decide not to give a trial, for any reason.
Substantial shareholding exemption ― overviewThe substantial shareholdings exemption (SSE) provides a complete exemption from the liability to corporation tax on the gains generated from qualifying disposals of shares and interests in shares by qualifying companies. No claim is required. Provided
Payments on account (POA)This guidance note provides and overview of the payments on account regime (POA). More in depth commentary can be found in De Voil Indirect Tax Service V5.110.What are payments on account?VAT registered businesses with an annual VAT liability of more than £2.3m are required
Terminal trading loss reliefTerminal loss relief for trade losses in the final 12 monthsTrading losses incurred by a company in the final 12 months leading up to the discontinuance of trade may be carried back for up to three years from the period beginning immediately before that 12-month period.