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HMRC internal manual

Inheritance Tax Manual

Qualifying investments: what are qualifying investments?

For investments to qualify for relief they must form part of the death estate. The following are qualifying investments

  • shares or securities which at the date of death were quoted
  • holdings in authorised unit trusts, as defined in Corporation Tax Act 2010/S616 to 619 (formerly Income and Corporation Taxes Act 1988/S468)
  • open ended investment companies (OEIC) (IHTM34141
  • shares held in a common investment fund established under s.42 Administration of  Justice Act 1982

Quoted holdings include shares that are listed on the London Stock Exchange and shares that are listed on a recognised foreign stock exchange (IHTM34140).  Shares quoted on NASDAQ (National Association of Securities Dealers Automated Quotations) also qualify for relief if the date of death was on or after 10 March 1992.

You will only rarely come across common investment funds.  They relate to funds in Court that are administered by the Public Trustee and are comparable to unit trusts.  The value of a share in one of them is determined by the total value of the underlying securities at the relevant time.