HM Revenue and Customs v Trustees of the Nelson Dance Family Settlement, Court of Appeal - Chancery Division, January 22, 2009, [2009] EWHC 71 (Ch)

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HM Revenue and Customs v Trustees of the Nelson Dance Family Settlement, Court of Appeal - Chancery Division, January 22, 2009, [2009] EWHC 71 (Ch)

Neutral Citation Number: [2009] EWHC 71 (Ch)

Case No: CH/2008/APP/0434

IN THE HIGH COURT OF JUSTICE

CHANCERY DIVISION

Royal Courts of Justice

Strand, London, WC2A 2LL

Date: 22/01/2009

Before :

THE HONOURABLE MR JUSTICE SALES

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Between :

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Mr Christopher Tidmarsh QC (instructed by HMRC Solicitors) for the Appellants

Mr William Massey QC (instructed by Payne Hicks Beach) for the Respondents

Hearing date: 3/12/08

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JudgmentMr Justice Sales :

1. This is an appeal by HM Revenue and Customs (``HMRC'') from a decision of the Special Commissioner, Dr Avery Jones CBE, giving judgment for the Trustees of the Nelson Dance Family Settlement (``the Trustees'') on a preliminary issue in relation to the liability of the Trustees to pay tax under the Inheritance Tax Act 1984 (``the IHTA'') in respect of a transfer by Nelson Dance (``Mr Dance'') of agricultural land into the hands of the Trustees in late 2002 or early 2003. The preliminary issue concerns the question whether the transfer qualifies for business property relief (``BPR'') under s. 104 of the IHTA. This question is significant because although it is agreed that the transfer qualifies for agricultural relief under the IHTA, that relief is limited to the agricultural value of the land. In the present case, the land has development value, so the Trustees claim BPR under s. 104 of the IHTA in relation to the value of the land over and above its agricultural value.

2. The form of the preliminary issue was agreed at the hearing before me in simpler terms than those in which it had been stated before the Special Commissioner, as follows: whether, on the facts agreed or assumed below, BPR was available on the value transferred by the Transfer of Value defined below (i.e. the transfer of value associated with the creation of the Nelson Dance Family Settlement by the transfer of the relevant property into the hands of the Trustees). The facts have been agreed between the parties solely for the purposes of the determination of the preliminary issue, and the parties reserve their positions on points...

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