Inheritance Tax Act 1984 section 25

Gifts for national purposes, etc.

Section 25 provides an inheritance tax exemption for transfers of property to certain national bodies, institutions and government departments listed in Schedule 3, as well as for gifts to the nation under the Finance Act 2012.

• Transfers of property to bodies listed in Schedule 3 (such as the National Gallery, British Museum, National Trust, local authorities, universities and government departments) are exempt from inheritance tax with no value limit.
• The exemption applies to both lifetime transfers and transfers on death, including transfers of settled property in which the deceased or transferor had an interest in possession.
• The same anti-avoidance rules that apply to the charity exemption generally apply here, but with a special relaxation: gifts of property subject to an agreement restricting the use of land are not denied exemption merely because the gift is of less than the donor's whole interest.
• A separate exemption also applies where property is given as a "gift to the nation" under the scheme established by Schedule 14 to the Finance Act 2012.