| Commentary

34.3 Inheritance tax

| Commentary

34.3 Inheritance tax

The lifetime gift of a business, or assets used in that business, will usually constitute a transfer of value1 for inheritance tax purposes. A transfer of value is chargeable to inheritance tax if it is made by an individual but is not an exempt transfer2. Fortunately for a sole trader wishing to give away his business, any transfer of business assets is likely to be a potentially exempt transfer (PET). A PET is a gift by an individual to another individual, which would otherwise have been chargeable to inheritance tax3. A PET will only become chargeable if

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