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HMRC internal manual

Inheritance Tax Manual

HM Revenue & Customs
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FACET procedures: exchanges

If any ‘qualifying investments’ (IHTM34131) wereexchanged during the 12 months following the death, question 3(a) on page 4 of the formIHT 35 should be ticked ‘Yes’. Additional information about the exchanges shouldalso be included with the IHT 35.

You should check the details of the exchange in Extel. If substitute shares only werereceived they will check that these have been correctly included in the sales columns. Ifshares plus a cash sum were received they will check that the cash is also included in thegross proceeds of sale.

You can get more information about the treatment of exchanges at (IHTM34154).