Business assets must have been owned for two years prior to death to qualify for Business Property Relief. BPR.
A full explanation of BPR can be found at the governmentt’s Inland Revenue website www.hmrc.gov.uk, go to the section called Inheritance tax and then look for HMRC Inheritance Tax: Customer Guide and you’ll find a list of suitable questions with full answers.
It describes in detail the types of business, the types of property and the types of relief available. There’s too much to reproduce here, so go spend some time looking over the questions and answers.
Taken from their website:
‘Is there a minimum period of ownership?
Yes. The general rule is that property is not relevant business property (and so does not qualify for relief) unless it was owned as such by the transferor throughout the two years immediately before the transfer.
Points to note regarding the minimum period of ownership:
If the transferor became entitled to the property on the death of a spouse or civil partner, relief is available for any period during which the spouse or civil partner owned it.
If the transferred property was acquired on an earlier transfer within the two-year period, relief is available if
the earlier transfer was eligible for business relief
the earlier transfer was made to the current transferor or spouse or civil partner
one of the transfers was made on death, and
the property, apart from the two-year rule, would qualify for relief.
Relief is available when the transferred property replaces other relievable property
If the transferor inherits the property on a death, we consider the ownership to run from the date of that death.’
LSUK are professional advisers with regard to planning within wills, so as always, a one to one meeting with a consultant is the best way to be specific about your own personal and specific circumstances.
Filed under: Legal Advice, Wills
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