Inheritance Tax Act 1984 section 150

Voidable transfers

Section 150 deals with the inheritance tax consequences when a chargeable transfer is later set aside as voidable or otherwise defeasible under any enactment or rule of law, allowing tax already paid to be reclaimed and future tax rates to be recalculated as if the transfer had never been made.

• Where a chargeable transfer is set aside as voidable or defeasible, any inheritance tax (including interest) paid on that transfer which would not have been due had the transfer never existed must be repaid by HMRC, or ceases to be payable.
• Tax paid on any other earlier chargeable transfer that was calculated at a higher rate because of the now-voided transfer must also be repaid or adjusted accordingly.
• Future chargeable transfers made by the same person after the claim are taxed at the rates that would apply as if the voided transfer had never taken place, effectively removing it from the cumulative total.
• A claim must be made within four years of the date the claimant knew, or ought reasonably to have known, that the transfer had been set aside.