Partnerships ― inheritance tax

Copyright © 2026 LexisNexis
Produced by a Tolley Owner-Managed Businesses expert
Owner-Managed Businesses
Guidance

Partnerships ― inheritance tax

Copyright © 2026 LexisNexis
Produced by a Tolley Owner-Managed Businesses expert
Owner-Managed Businesses
Guidance
imgtext

This note explains the general rules surrounding the inheritance tax (IHT) implications of being a partner in an English general partnership. Different rules may apply to Scottish partnerships, see Simon's Taxes I6.201.

As a partnership is transparent for tax purposes, the inheritance tax rules are applied to each partner in accordance with their individual circumstances and their interest in the partnership and its assets.

See also the following guidance notes:

  1. •

    Practical tips for securing BPR as a 'trading business' for practical IHT planning points for partnership agreements.

  2. •

    Interaction of APR and BPR for farming partnerships

  3. •

    BPR ― the value of the business which sets out details of valuing partnership interests for IHT purposes

Transfer of partnership interest to a connected person

The definition of a connected person is in TCGA 1992, s 286 as applied by IHTA 1984, s 270.

The transfer of an individual’s share in a partnership to a connected person is not treated as a transfer of value for IHT purposes, provided there is no gratuitous benefit passed

Continue reading the full document
To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+™
TAKE A FREE TRIAL NOW
Powered by Tolley+™
  • 03 Sep 2026 08:40

Home/ Tolley Tax Guidance/ Owner-Managed Businesses / Advising partnerships

Popular Articles

Trusts and Inheritance Tax

Spouse exemption from inheritance tax

Spouse exemption from inheritance taxArguably, the most important inheritance tax exemption is the spouse exemption from inheritance tax.There is no IHT to pay on gifts from husband to wife and vice versa, or from one civil partner to the other (referred to collectively in this note as ‘spouses’).

14 Jul 2020 13:56 | Produced by Tolley in association with Emma Haley at Boodle Hatfield LLP Read more Read more
Personal Tax

Inter-spouse transfer

Inter-spouse transferIntroductionWhen a chargeable asset is transferred between two spouses or civil partners, there is a disposal by the transferor spouse / civil partner and an acquisition by the transferee spouse / civil partner for capital gains tax purposes. For simplicity, spouses and civil

14 Jul 2020 12:01 | Produced by Tolley Read more Read more
Corporation Tax

Qualifying charitable donations

Qualifying charitable donationsCompanies can obtain corporation tax relief for qualifying payments or certain transfers of assets to charity under the qualifying charitable donations regime. Definition of qualifying charitable donationThe definition of ‘qualifying charitable donations’

14 Jul 2020 13:03 | Produced by Tolley Read more Read more