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HMRC internal manual

Inheritance Tax Manual

HM Revenue & Customs
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Sales of related property, etc: price obtained on sale must be less than the original value

The relief only applies if the price obtained on sale, after making any adjustment for any difference in circumstances is less than the amount at which the property concerned was originally valued, IHTA84/S176 (4). For this purpose in arriving at the original value you should disregard both this relief and loss on sale of land relief (IHTM33132).

You should take a difference in circumstances to include a change in

  • market conditions
  • the state of the property
  • the duration of a leasehold or other terminable interest, or
  • any other factor relevant to the valuation apart from the fact of valuation with and sale without other property.