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HMRC internal manual

Inheritance Tax Manual

From
HM Revenue & Customs
Updated
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Attribution of values to specific investments: purchases of qualifying investments

The sale value of specific investments may need to be revised if loss on sale of shares relief has been restricted (IHTM34211) under IHTA84/S180 (1) following the purchase of ‘qualifying investments’ (IHTM34131), IHTA84/S187 (3).

The effect of S187 (3) on specific investments will depend on whether

  • the value of the investment on death exceeds its sale price – the revised value will be the aggregate of its sale price and an amount equal to the ‘relevant proportion’ of the difference between its value on death and its sale price, or
  • the sale price exceeds its value on death – the revised value is the sale price less an amount equal to the ‘relevant proportion’ of the difference between its value on death and its sale price.The ‘relevant proportion’ (

IHTM34212) is the same as that used in IHTA84/S180 (1). You must include any capital payments (IHTM34177) in arriving at the ‘sale price’ of the investments. In addition, payments of call (IHTM34242) or consideration (IHTM34243) given for a new holding will reduce the sale value.

There is an example showing how the value of investments are revised under IHTA84/S187 (3) on the next page (IHTM34245).