Inheritance Tax Act 1984 section 54B

Provisions supplementary to section 54A

Section 54B provides supplementary rules for the special rate of charge under section 54A, addressing the effect of deaths on the tax charged and how previous transfers by the same settlor are taken into account.

• The death of the settlor after a section 54A chargeable transfer does not increase the tax unless the section 54A charge already exceeded the normal charge at the time of transfer.
• The death of the person entitled to the relevant interest does not increase the tax unless the normal charge already exceeded the section 54A charge at the time of transfer.
• Where section 54A applies and there has been another section 54A transfer by the same settlor within the previous seven years, the value attributable to special rate property from the earlier transfer is treated as a chargeable transfer made immediately before the potentially exempt transfer.
• Where the section 54A special rate applies, the tax calculated under that provision is treated as tax attributable to the value of the property in which the relevant interest subsisted.