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HMRC internal manual

Inheritance Tax Manual

Woodlands: the election

An election in writing must be made by the person liable (IHTM30011) for the whole or part of the tax and the election must be made within two years of the death or such longer period as the Board of HMRC may allow. Where there is a valid election

  • the value of the trees or underwood (but not the land) is left out of account (IHTM04331) in determining the value transferred (IHTM04028) by the chargeable transfer on death, and
  • tax will be charged on a subsequent disposal of the trees or underwood.

An election may be made for distinct areas of timber in the estate provided they are identifiable.

An election made as a consequence of the extension of woodlands relief to include land in states within the European Economic Area (IHTM04377) must be made on or before

  • the date determined under section 125(3) IHTA84 as the last date on which the election may be made, or
  • 21 April 2010,

whichever is later under FA2009/S122(9).

Where within two years of a death the taxpayer seeks to withdraw an election they should normally be allowed to do so. Where such a request is made more than two years after the death and there are special circumstances the case should be given sympathetic consideration but you should ask whether the timber has been or is about to be sold.