Inheritance Tax Act 1984 section 2

Chargeable transfers and exempt transfers

Section 2 defines what a chargeable transfer is and explains how transfers that are only partly exempt are treated for inheritance tax purposes.

• A chargeable transfer is any transfer of value made by an individual that is not an exempt transfer under Part II of the Act or any other legislation.
• Where a transfer qualifies for only a limited exemption, the part within the exemption limit is an exempt transfer and the part exceeding the limit is a chargeable transfer.
• If the entire value transferred falls within the exemption limit, the whole transfer is treated as exempt.
• References to chargeable transfers in the Act generally also cover occasions when tax arises on certain settled property under Chapter III of Part III (the ten-yearly and exit charges), except for the specific exemption in section 79.