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HMRC internal manual

Inheritance Tax Manual

Joint property: joint property and inheritance tax

The Inheritance Tax Act contains

  • no provisions that apply specifically or exclusively to lifetime charges (IHTM15060) on joint property (IHTM15011): and
  • only one provision, IHTA84/S171 (2), that specifically relates to the charge on death. And that provision is required only to exclude the operation of IHTA84/S171 (1), (IHTM04046).

So, any charge to tax on joint property has to be based on applying the ordinary provisions of the legislation to the beneficial entitlements (IHTM15011). The main provisions that apply are:

  • IHTA84/S3, which defines ‘transfer of value’ (IHTM04024)
  • IHTA84/S4, for the charge on death (IHTM04041)
  • IHTA84/S5, which defines ‘estate’ (IHTM04029) and
  • IHTA84/S272 under which ‘property’ (IHTM04030) includes rights and interests of every description

Under these provision’s a person’s beneficial entitlement to joint property forms part of their estate for the purposes of the Inheritance Tax charge both on transfers on death and lifetime transfers.

In addition, FA 1986/S102 and FA 1999/S104 govern any gift with reservation (IHTM15061) charge on joint property.