Lifetime transfers reported late
I3.551 Transfers reported late—the basic rules
Since the amount of IHT due on a chargeable transfer depends on the transferor's cumulative total of chargeable transfers made in the seven years preceding the making of the transfer, it is evident that practical difficulties arise where chargeable transfers are not reported within the time limits set by the legislation. Thus if a chargeable transfer takes place but is not reported, tax on a later chargeable transfer will be calculated without regard to the effect of the earlier transfer on the transferor's cumulative total and so perhaps will be charged at lower rates of tax than should have been the case.
The rules described in this article and I3.552–I3.554 relate to chargeable transfers made under CTT (see I1.301–I1.303) that are discovered after 26 July 1981, and IHT chargeable transfers. They are set out in IHTA 1984, s 264. The rules apply where a chargeable transfer has not been reported before the expiration of the period specified in IHTA 1984, s 216 for delivery of accounts, and is discovered after the tax on a transfer, made by the same transferor on or after the day on which the late-reported transfer was made, has been paid1. It should be noted that an account of a potentially exempt transfer (PET) only has to be delivered
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