Commentary

I7.112D BPR and controlling holdings

IHT, trusts and estates

I7.112D BPR and controlling holdings

I7.112D BPR and controlling holdings

This business property relief (BPR) category is not as important as it once was, as 100% BPR now applies to all unquoted shares irrespective of the size of the holding (see I7.112B). The current position, for transfers after 5 April 1996, is that there remain two kinds of relevant business property qualifying for IHT BPR where control of a company is a defining characteristic:

  1.  

    •     holdings of quoted shares in or securities of a company which, alone or together with other shares or securities owned by the transferor, give him control of the company1. The rate of relief is 50%2

  2.  

    •     holdings of unquoted securities of a company which, alone or together with other securities owned by the transferor and any unquoted shares owned by him, give him control of the company3. The rate of relief is 100%4. Securities on the AIM are unquoted for this purpose

'Quoted' here means listed on a recognised stock exchange and 'unquoted' means securities not listed on a recognised stock exchange5. For the latest list of stock exchanges recognised by HMRC, see Recognised stock exchanges.

In order to qualify for the relief, the holdings described above have to satisfy the other requirements for relevant business property described in this Division. The requirement that the holding gives or contributes to giving the transferor control means that the holding must be of shares or securities which themselves carry votes. There is no BPR for securities (as opposed to shares), or for quoted shares,

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