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HMRC internal manual

Capital Gains Manual

HM Revenue & Customs
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Valuation of assets: ascertained values: consideration by Specialist PT-IHT

Simply because a value has been provided to Specialist PT - IHT, formerly CAR - IHT and before that the Capital Taxes Office, and has not been revised by that office does not mean that value has been `ascertained’ for the purposes of TCGA92/S274. On receipt of the statement setting out the details of the estate, the proposed values and details of how the estate devolves, Specialist PT - IHT may decide that it does not need to accurately assess the values of some or all of the assets. This would be because the value of those assets does not affect the amount of any Inheritance Tax payable. This can happen in the following circumstances.

  • All the assets pass to a surviving spouse or civil partner and the entire estate is exempt.
  • All the assets pass to charities, political parties or other persons listed in schedule 3 to IHTA and the estate is thus exempt.
  • The estimated value of the estate is well below the threshold on which tax is to be payable and it can be accepted that the estate is non taxpaying.
  • The assets of the estate are all covered by the reliefs for agricultural and business assets in a period when the rates of relief for such assets are 100 per cent.
  • Some combination of the above factors and/or other exemptions makes the estate non taxpaying.

In all these cases the values will not have been considered in any detail or are not considered at all and are not ‘ascertained’ for the purposes of TCGA92/S274. In practice the great majority of estates are not liable to IHT and the values will not have been ascertained. You should be aware that if the availability of reliefs means that there is no liability to IHT whatever the value of the asset it is possible its value may be inflated in the hope of getting a Capital Gains Tax advantage.

The HMRC website gives further information on Inheritance Tax. You can also consult the Inheritance Tax Manual (IHTM) in the Intranet Library.