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Chapter IHTM24143

Document Cited authorities 1 Cited in Related
Vincent
Published date20 March 2016
Record NumberIHTM24143
CourtHM Revenue & Customs
IssuerHM Revenue & Customs
Land let on new tenancies

IHTA84/S116 (2)(c) (inserted by FA95/S155) states that 100% relief will apply if the interest of the transferor in the property does not carry either of the rights mentioned in paragraph (a) that is

  • the right to vacant possession, or
  • the right to obtain it within 12 months,

because the property is let on a tenancy beginning on or after 1 September 1995.

So, this section will apply for all new tenancies of agricultural land that began on or after 1 September 1995, not just farm business tenancies under the ATA 1995. Further guidance on this point, and an example, can be found at IHTM24241. A succession tenancy granted under the statutory succession scheme in the 1986 Act will be a ‘new’ tenancy for this purpose if it began on or after 1 September 1995. For the purposes of inheritance tax the beginning of the new tenancy is taken to be the date of death of the tenant who has been succeeded, IHTA84/S116 (5B).

Surrender of AHA 1986 tenancy

A tenancy under the 1986 Act may be terminated and a farm business tenancy granted in its place in order to take advantage of the new provisions, particularly in family situations. So long as there has been a clear surrender of the old tenancy (or the necessary notice and counter-notice has taken place to formally determine the old tenancy) there...

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