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HMRC internal manual

Inheritance Tax Manual

Lifetime transfers: specific lifetime reliefs: fall in value relief: conditions for relief

All the following conditions must be satisfied before you can allow any relief

  • The value transferred by the failed potentially exempt transfer (IHTM04057) or chargeable transfer must be wholly or partly attributable to property which either

    • remains the property of the transferee (or of the spouse or civil partner (IHTM11032) of the transferee) at the date of death, or
    • has been sold by the transferee (or spouse or civil partner of the transferee) by an earlier qualifying sale (IHTM14625).
  • The market value (IHTM14626) of the transferred property at the time of the transfer must exceed its market value at the date of death or sale.
  • A claim in writing must be made by a person liable to pay the tax, or additional tax (IHTM14571), within 4 years of the date of the donor’s death, IHTA/S131(2ZA).