Jurisdiction(s):
United Kingdom

Amending Business Property Relief legacy clauses in wills: accommodating 50% relief, discretionary trusts, group company and excepted assets restrictions, and post-death s144 appointments (UK IHTA 1984)

Published on: 07 February 2024

Published by a LexisNexis Private Client expert

Legal News

Article summary

See Q&A: A testator owns shares in the parent company of a trading group of companies.

A testator holding shares in the holding company of a trading group may find the share value restricted for business property relief (BPR) purposes because of excepted assets or the group company provisions, with the result that full relief is not achieved. One LexisNexis Will precedent leaves property qualifying for BPR at 100% on discretionary trusts. Can that wording be modified to capture property that qualifies for BPR at a lower percentage? For this Q&A, the assumed Will precedent is: Will—legacy of business property on discretionary trust, residue to spouse absolutely, then to children absolutely. The starting point is that BPR is available only at two statutory rates—100% or 50%—provided the necessary conditions are satisfied in each situation. As at 5 February 2024, there is no scope for business property to qualify for BPR at any rate other than these. Accordingly, while the precedent could be reframed to include assets eligible for BPR at 50% as well as those at 100%, it cannot extend to any intermediate or alternative percentage reliefs, since no such rates exist within the current BPR regime...

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