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HMRC internal manual

Lloyd's Manual

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HM Revenue & Customs
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Inheritance tax: Names: business property relief: rate of relief

Individual Names

The value of an individual Name’s Lloyd’s interests normally qualifies for100% relief under IHTA84/S105 (1)(a).

Scottish limited partnerships and Limited Liability Partnerships

An interest in a trading partnership, as with a corporate vehicle, should attract 100%relief as should Funds at Lloyd’s (FAL) assets utilised by an SLP or LLP throughinteravailability.

Corporate members

‘Corporate member’ here refers to incorporated companies that are members ofLloyd’s, including ‘Namecos’. In broad terms, companies are not subject toIHT. However, shareholdings in corporate vehicles should attract business property relief(BPR) of 100% where unquoted or 50% for shares or securities giving control of a quotedcompany.

A shareholding in a Nameco will qualify for BPR at 100% providing the two-year ownershipcondition of IHTA84/S106 is satisfied.

As a general rule, FAL assets do not qualify for BPR during the first two years of a newbusiness. However, special rules (IHTA84/S107) apply for replacement property and,provided a Name transfers the whole of his bespoke business to a new corporate business,the new business will be treated as replacement property.

In the situation where a Name was in the process of transferring their entire personalbusiness into a Nameco at the date of death, the shares allotted in return for thetendering of eligible capacity will be treated as replacement property within the meaningof IHTA84/S107 and BPR at 100% will be available.