swarb.co.uk - law index
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Inheritance Tax - From: 1994 To: 1994
This page lists 2 cases, and was prepared on 08 August 2015.
ÂStarke and Another (Executors of Brown Deceased) -v- Inland Revenue Commissioners Gazette, 30 March 1994; Times, 24 February 1994; [1994] STC 295
24 Feb 1994
ChD
Blackburne J
Inheritance Tax
Mr Brown, the deceased, had owned a site on which was built a substantial farmhouse, with six bedrooms, and various outbuildings. The site formed part of a farm and the issue was whether the site was "agricultural land or pasture" within the meaning of section 115(2). Held: A site with farm buildings only is not within the definition of agricultural land in the section. Such buildings had to be proportionate in size and nature to the requirements of the farming activities: "If cottages, farm buildings and farmhouses which are occupied and used for the purposes of agriculture fall within the meaning of agricultural land it is difficult to see what the point is of the "character appropriate" requirement in limb (3). If, however, cottages, farm buildings and farmhouses, together with any land occupied with them, are not within the expression "agricultural land or pasture" but will constitute "agricultural property" if used in connection with agricultural land or pasture provided that they are of a character appropriate to such agricultural land or pasture (that is, are proportionate in size and nature to the requirements of the farming activities conducted on the agricultural land or pasture in question) then it is possible to attribute a full meaning to that limb."
'Agricultural property' for Inheritance tax purposes was restricted to pasture land which remained undeveloped.
Inheritance Tax Act 1984 115
1 Cites
1 Citers
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Gray -v- Inland Revenue Commissioners Times, 24 February 1994; [1994] STC 360
24 Feb 1994
CA
Inheritance Tax
Partnership interests in a tenanted freehold estate can be valued together. The court considered the 'statutory hypothetical sale' when valuing property for Inheritance Tax purposes: "The property must be assumed to have been capable of sale in the open market, even if in fact it was inherently unassignable or held subject to restrictions on sale. The question is what a purchaser in the open market would have paid to enjoy whatever rights attached to the property at the relevant date (see IRC –v- Crossman [1937] AC 26). Furthermore, the hypothesis must be applied to the property as it actually existed and not to some other property, even if in real life a vendor would have been likely to make some changes or improvements before putting it on the market (see Duke of Buccleuch v IRC [1967] 1 AC 506 at 525). To this extent, but only to this extent, the express terms of the statute may introduce an element of artificiality into the hypothesis. In all other respects, the theme which runs through the authorities is that one assumes that the hypothetical vendor and purchaser did whatever reasonable people buying and selling such property would be likely to have done in real life.
Inheritance Taxes Act 1974
1 Cites
1 Citers
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