Inheritance Tax Act 1984 section 41

Burden of tax

Section 41 deals with how the burden of inheritance tax is allocated among gifts and shares of residue, overriding any contrary directions in a will or other disposition.

• The rules in this section override whatever the will or other disposition says about who bears the tax.
• No inheritance tax can fall on a specific gift to the extent that the gift is exempt from tax.
• No inheritance tax attributable to the residuary estate can fall on a share of residue to the extent that the share is exempt from tax.
• The practical effect is that the tax burden is shifted away from exempt beneficiaries and onto the non-exempt gifts and shares of residue.