Inheritance Tax Act 1984 section 227

Payment by instalments – land, shares and businesses

Section 227 allows inheritance tax attributable to certain qualifying property — namely land, certain shares and securities, and businesses — to be paid in ten equal yearly instalments rather than as a single lump sum, provided the person paying the tax makes a written election to do so.

• Qualifying property eligible for instalment payments includes land (wherever situated), certain shares and securities, and businesses or interests in businesses
• The tax attributable to qualifying property may be paid in ten equal yearly instalments if the taxpayer makes a written election, but this right is generally limited to transfers on death, transfers where the tax is borne by the beneficiary, or certain settlement transfers
• If the qualifying property is sold (in whole or in part), any outstanding tax becomes payable immediately along with any accrued interest
• The instalment option is restricted for failed potentially exempt transfers and additional tax arising on death within seven years, unless the property meets specific retention or relief conditions

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