Commentary

I3.738 Full consideration exemption

IHT, trusts and estates

I3.738 Full consideration exemption

I3.738 Full consideration exemption

It follows from the interpretation of FA 2004, Sch 15, para 11(5)(d) set out in I3.737 that the pre-owned assets rules import the 'full consideration' exemption from the GWR rules. This applies for inheritance tax in certain circumstances where the property in question would be subject to the GWR rules but for the payment of full consideration in money or money's worth for the actual occupation of land or enjoyment of an incorporeal right over land, or for the actual possession of chattels1. It is thought that it may not have been the government's original intention to provide this exemption within the pre-owned assets regime, but the following Parliamentary statement during the Committee Stage debates on the Finance Bill 2004 indicated that such an intention had come into being2:

'QuoteStartIf there are normal arrangements between a landlord and a tenant … under a lease … there will be payments, agreements and obligations. I do not see how the rules give rise to a problem … They may have gifted the property away, but they are then making a payment at a reasonable rent with all the assumed

To continue reading
View the latest version of this document, as well as thousands of others like it, sign in to TolleyLibrary or register for a free trial