IHTM09713 - Valuing property in an estate: including property otherwise left out of account for tax purposes

In some circumstances property (IHTM04030) that is not chargeable to tax remains part of the estate for the purposes of valuing other property (or another part of the same property) in that estate. This property may be valued together with chargeable property and the value of the property that is not chargeable to tax is then excluded proportionately to arrive at the value of the chargeable asset.

Section 4 includes a list (IHTM04331) of the types of property that may be treated in this way.

Excluded property (IHTM04251) should not be taken into account either for the purpose of the charge to tax or for the purposes of valuing any other items in the estate.

But you should refer to TG any case where

• there is foreign property in a settlement that is excluded from the charge to tax under IHTA84/S53 (1), and
• you feel that by aggregating this with the chargeable property in the settlement will increase the value of the chargeable portion.

You should also refer to TG any case that causes difficulty because the interest in possession (IHTM16101) in a settlement extended to less than the whole of the settled property.