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Chapter IHTM24174

Cited authorities 1 Cited in Related
Vincent
Published date20 March 2016
Record NumberIHTM24174
CourtHM Revenue & Customs

The four conditions (IHTM24173) operate by reference to the ‘original property’, which is defined in IHTA84/S124A (8) as either

  • the agricultural property IHTM24030) to which IHTA84/S116 applied in relation to the transfer, in other words, the subject matter of the transfer, or
  • shares or securities (IHTM24175) of a company owning agricultural land to which IHTA84/S116 applied in relation to the transfer because of IHTA84/S122 (1).

Where the value transferred is greater than the value of the property transferred, relief is available for the whole of the loss to the transferor’s estate, (IHTM04054) including the depreciation in the value of property retained by the transferor, if the additional conditions are satisfied in relation to the ‘original property’. It does not matter that at the time of death, the property retained by the transferor may not qualify for agricultural relief.

Example 1

A retires from farming and makes a gift of the farmland, but retains the farmhouse and garden to live in. The loss to A’s estate is the value of the agricultural land given, plus the loss in value of the farmhouse because of its separation from the land. At the date of gift, the value transferred qualifies for agricultural relief. The transferee retains and farms the farmland.

On A’s death within seven years, all four conditions are...

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