Business Property Relief

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Business Property Relief

In the United Kingdom, the reduction or elimination of inheritance tax on the transfer of some types of property used for business purposes. For example, shares in unquoted companies in which the transferor had majority control are not subject to an inheritance tax because of business property relief. Likewise, land and machinery used primarily for a business before the transfer are taxed at half the ordinary rate.

References in periodicals archive ?

She can leave them again in her will and they will continue to enjoy Business Property Relief. This arrangement, known as 'double dipping,' essentially provides the opportunity to claim Business Property Relief twice and can be extremely valuable for business owners.

Where there's a will ... thinking about the death of a practice partner may be an uncomfortable process, but as Christine Green reflects, being prepared now can avoid serious legal complications further down the line

For inheritance tax, property owners would usually have a good claim for Business Property Relief (BPR), but I cannot see how BPR can survive once such properties are taxed as investments again and the capital gains relief is withdrawn.

Advice

AIM shares are currently treated as "unquoted" for IHT purposes, meaning that, if all other conditions are met, they will rank for full Business Property Relief (BPR) when Inheritance Tax is under consideration.

'Stealth tax' alert on sales; INHERITANCE: Brown 'threat' to exemption

However, as a business asset this should be eligible for 100 per cent agricultural property relief or business property relief. The risk is that at your death the 100 per cent relief will not be applicable.

Racing and the Tax man: POTs are the pits - but can be avoided

IF you are making a gift of a business asset to a son or daughter, remember to claim Business Property Relief from Inheritance Tax.

DON'T FORGET TO USE YOUR BREAKS; Other half adds up to big savings

Here we saw the executors of the estate successfully claim Business Property Relief ("BPR") on a livery.

Changes to law that will benefit many

After two years' ownership, commercial forests have 100 per cent Business Property Relief from inheritance tax and timber sales are free of income or capital gains tax.

A timely investment for those who don't have money to burn

These include business property relief, agricultural property relief, the purchase of AIM shares, setting up trusts, and lifetime gifts made in the seven years immediately before death.

RNRB changes lessen the cost of inheritance

Farming businesses can still qualify for Business Property Relief (BPR) under certain conditions, with one notable exception - property letting.

Diversification can offer real opportunities; Law firm Hugh James, in collaboration with the Country Landowners Association, has today published its Spotlight report on agricultural diversification. Matthew Evans, head of wealth management at Hugh James and co-author of the report, outlines some key considerations for farming businesses contemplating diversification

However, this in itself is a balancing act, as many of the trading tax reliefs (capital gains tax entrepreneurs' relief and inheritance tax business property relief to name but two) rely on there not being 'substantial' investment activities.

Paying out the profits of your business - sponsored feature; Expert advice on whether or not to pay profits out of your business - sponsored feature

He said:: "The quickest way of making a significant dent in your inheritance tax liabilities is to invest in assets that qualify for Business Property Relief (BPR), as this will give you relief from inheritance tax after just two years."

Make sure your family get best inheritance; ADVERTISING FEATURE

He did not, however, have the space to extol the virtues of investing in assets that qualify for Business Property Relief (BPR), which is another effective way of reducing inheritance tax liabilities.

AIM is to get accelerated relief from inheritance tax; ADVERTISING FEATURE Independent financial advice