Inheritance Tax Act 1984

The National Gallery.

Residence nil-rate amount: interest in home goes to descendants etc

The National Gallery.

Residence nil-rate amount: interest in home goes to descendants etc

Rate of ten-yearly charge.

The British Museum.

Potentially exempt transfers.

Gifts to charities.

Charge to tax on property to which section 71A applies

Interpretation of sections 74A and 74B

Section 74A: supplementary provision

The National Gallery.

Meaning of “inherited”

Effect of alterations of capital, etc

The relief.

Scotland; legitim. etc.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

The British Museum.

Death of constables and service personnel targeted because of their status

The National Gallery.

Notifying appeal to tribunal after review concluded

The British Museum.

Interest on overpaid tax.

The British Museum.

Meaning of “brought-forward allowance”

The National Gallery.

74A

• (1) This section applies where—

• (a) one or more persons enter into arrangements,

• (b) in the course of the arrangements—

• (i) an individual (“the individual”) ... acquires or becomes able to acquire (directly or indirectly) an interest in property comprised in a settlement ( “ the relevant settled property ”), and

• (ii) consideration in money or money's worth is given by one or more of the persons mentioned in paragraph (a) (whether or not in connection with the acquisition of that interest or the individual becoming able to acquire it),

• (ba) the individual—

• (i) is a long-term UK resident at any time on or after 6 April 2025 during the course of the arrangements, or

• (ii) acquired the interest, or became able to acquire it, at a time before 6 April 2025 while domiciled in the United Kingdom,

• (c) there is a relevant reduction in the value of the individual's estate, and

• (d) condition A or condition B is met.

• (2) Condition A is that the relevant settled property is excluded property at any time during the course of the arrangements.

Ignore for this purpose—

• (a) section 48ZA(8) (as it has effect on and after 6 April 2025);

• (b) section 48(3D) (as it had effect before 6 April 2025).

• (3) Condition B is that—

• (a) the settlor was not an individual or a close company at the time the relevant settled property became comprised in the settlement, and

• (b) condition A is not met.

• (4) Subsection (6) applies if all or a part of a relevant reduction (“amount A”) is attributable to the value of the individual's section 49(1) property being less than it would have been in the absence of the arrangements.

• (5) “The individual's section 49(1) property” means settled property to which the individual is treated as beneficially entitled under section 49(1) by reason of the individual being beneficially entitled to an interest in possession in the property.

• (6) Where this subsection applies—

• (a) a part of that interest in possession is deemed, for the purposes of section 52, to come to an end at the relevant time, and

• (b) that section applies in relation to the coming to an end of that part as if the reference in subsection (4)(a) of that section to a corresponding part of the whole value of the property in which the interest in possession subsists were a reference to amount A.

• (7) Subsection (8) applies to so much (if any) of a relevant reduction as is not amount A (“amount B”).

• (8) Tax is to be charged as if the individual had made a transfer of value at the relevant time and the value transferred by it had been equal to amount B.

74B

• (1) A transfer of value arising by virtue of section 74A is to be taken to be a transfer which is not a potentially exempt transfer.

• (2) For the purposes of section 74A—

• (a) when determining the value transferred by a transfer of value arising by virtue of that section, no account is to be taken of section 3(2),

• (b) nothing in section 10(1) applies to prevent such a transfer, and

• (c) nothing in sections 102 to 102C of the Finance Act 1986 applies in relation to such a transfer.

• (3) Where, ignoring this subsection, a transfer of value would arise by virtue of section 74A (“the current transfer”), the value transferred by a relevant related transfer is to be treated as reducing the value transferred by the current transfer.

But this subsection does not apply if and to the extent that the relevant related transfer has already been applied to reduce another transfer of value arising by virtue of that section.

• (4) “Relevant related transfer” means—

• (a) where the arrangements consist of a series of operations, any transfer of value constituted by one or more of those operations which occur before or at the same time as the current transfer, other than a transfer of value arising by virtue of section 74A, and

• (b) where the arrangements consist of a single operation, any transfer of value which arises from that operation, other than a transfer of value arising by virtue of section 74A.

• (5) Section 268(3) does not apply to a transfer of value arising by virtue of section 74A.

• (6) Where—

• (a) a transfer of value has arisen by virtue of section 74A,

• (b) in the course of the arrangements the individual acquires an interest in possession in settled property, and

• (c) section 5(1B) applies to the interest in possession so that it forms part of the individual's estate,

this Act has effect as if that transfer of value had never arisen.

74C

• (1) Subsections (2) to (4) have effect for the purposes of sections 74A and 74B.

• (2) An individual has an interest in property comprised in a settlement if—

• (a) the property, or any derived property, is or will or may become payable to, or applicable for the benefit of—

• (i) the individual,

• (ii) the individual's spouse or civil partner, or

• (iii) a close company in relation to which the individual or the individual's spouse or civil partner is a participator or a company which is a 51% subsidiary of such a close company,

in any circumstances whatsoever, or

• (b) a person within sub-paragraph (i), (ii) or (iii) of paragraph (a) enjoys a benefit deriving (directly or indirectly) from the property or any derived property.

• (3) A “relevant reduction” in the value of the individual's estate occurs—

• (a) if and when the value of the individual's estate first becomes less than it would have been in the absence of the arrangements, and

• (b) on each subsequent occasion when the value of that estate becomes less than it would have been in the absence of the arrangements and that difference in value is greater than the sum of any previous relevant reductions.

• (4) The amount of a relevant reduction is—

• (a) in the case of a reduction within subsection (3)(a), the difference between the value of the estate and its value in the absence of the arrangements, and

• (b) in the case of a reduction within subsection (3)(b), the amount by which the difference in value mentioned in that provision exceeds the sum of any previous relevant reductions.

• (5) In sections 74A and 74B and this section—

• “arrangements” includes any scheme, transaction or series of transactions, agreement or understanding, whether or not legally enforceable, and any associated operations;

• “close company” has the meaning given in section 102;

• “derived property”, in relation to any property, means—income from that property,property directly or indirectly representing—proceeds of that property, orproceeds of income from that property, orincome from property which is derived property by virtue of paragraph (b);

• “operation” includes an omission;

• “participator” has the meaning given in section 102;

• “the relevant time” means—the time the relevant reduction occurs, orif later, the time section 74A first applied;

• “51% subsidiary” has the same meaning as in the Corporation Tax Acts (see Chapter 3 of Part 24 of the Corporation Tax Act 2010).

141A

• (1) This section applies if any part of the value transferred by the later transfer qualifies for the lower rate of tax in accordance with Schedule 1A.

• (2) The amount of the reduction made under section 141(1) is to be apportioned in accordance with this section.

• (3) For each qualifying component, the tax chargeable on so much of the value transferred by the later transfer as is attributable to property in that component (“the relevant part of the tax”) is to be reduced by the appropriate proportion of the amount calculated in accordance with section 141(3).

• (4) “The appropriate proportion” is a proportion equal to the proportion that—

• (a) the relevant part of the tax, bears to

• (b) the tax chargeable on the value transferred by the later transfer as a whole.

• (5) If parts of an estate are treated under Schedule 1A as a single component, subsection (3) applies to the single component (and not to individual components forming part of the deemed single component).

• (6) If, after making the reductions required by subsection (3), there remains any part of the tax chargeable on the value transferred by the later transfer that has not been reduced, the remaining part of the tax is to be reduced by so much of the amount calculated in accordance with section 141(3) as has not been used up for the purposes of making the reductions required by subsection (3).

• (7) In this section—

• “component” means a component of the estate, as defined in paragraph 3 of Schedule 1A;

• “the later transfer” has the meaning given in section 141(1);

• “qualifying component” means a component (or deemed single component) for which the donated amount is at least 10% of the baseline amount, as determined in accordance with Schedule 1A.

SCHEDULE 1A

Application of this Schedule

1

• (1) This Schedule applies if—

• (a) a chargeable transfer is made (under section 4) on the death of a person (“D”), and

• (b) all or part of the value transferred by the chargeable transfer is chargeable to tax at a rate other than nil per cent.

• (2) The part of the value transferred that is chargeable to tax at a rate other than nil per cent is referred to in this Schedule as “TP”.

The relief

2

• (1) If the charitable giving condition is met—

• (a) the tax charged on the part of TP that qualifies for the lower rate of tax is to be charged at the lower rate of tax, and

• (b) the tax charged on any remaining part of TP is to be charged at the rate at which it would (but for this Schedule) have been charged on the whole of TP in accordance with section 7.

• (2) For the purposes of this paragraph, the charitable giving condition is met if, for one or more components of the estate (taking each component separately), the donated amount is at least 10% of the baseline amount.

• (3) Paragraph 3 defines the components of the estate.

• (4) Paragraphs 4 and 5 explain how to calculate the donated amount and the baseline amount for each component.

• (5) The part of TP that “qualifies for the lower rate of tax” is the part attributable to all the property in each of the components for which the donated amount is at least 10% of the baseline amount.

• (6) The lower rate of tax is 36%.

The components of the estate

3

• (1) For the purposes of paragraph 2, the components of the estate are—

• (a) the survivorship component,

• (b) the settled property component, and

• (c) the general component.

• (2) The survivorship component is made up of all the property comprised in the estate that, immediately before D's death, was joint (or common) property liable to pass on D's death—

• (a) by survivorship (in England and Wales or Northern Ireland),

• (b) under a special destination (in Scotland), or

• (c) by or under anything corresponding to survivorship or a special destination under the law of a country or territory outside the United Kingdom.

• (3) The settled property component is made up of all the settled property comprised in the estate in which there subsisted, immediately before D's death, an interest in possession to which D was beneficially entitled immediately before death.

• (4) The general component is made up of all the property comprised in the estate other than—

• (a) property in the survivorship component,

• (b) property in the settled property component, and

• (c) property that forms part of the estate by virtue of section 102(3) of the Finance Act 1986 (gifts with reservation).

The donated amount

4

The donated amount, for a component of the estate, is so much of the value transferred by the relevant transfer as (in total) is attributable to property that—

• (a) forms part of that component, and

• (b) is property in relation to which section 23(1) applies.

The baseline amount

5

The baseline amount, for a component of the estate, is the amount calculated in accordance with the following steps—

• Step 1 Determine the part of the value transferred by the chargeable transfer that is attributable to property in that component.

• Step 2 Deduct from the amount determined under Step 1 the appropriate proportion of the available nil-rate band.“The appropriate proportion” is a proportion equal to the proportion that the amount determined under Step 1 bears to the value transferred by the chargeable transfer as a whole.“The available nil-rate band” is the amount (if any) by which—the nil-rate band maximum (increased, where applicable, in accordance with section 8A), exceedsthe sum of the values transferred by previous chargeable transfers made by D in the period of 7 years ending with the date of the relevant transfer.

• Step 3 Add to the amount determined under Step 2 an amount equal to so much of the value transferred by the relevant transfer as (in total) is attributable to property that—forms part of that component, andis property in relation to which section 23(1) applies.The result is the baseline amount for that component.

Rules for determining whether charitable giving condition is met

6

• (1) For the purpose of calculating the donated amount and the baseline amount, any amount to be arrived at in accordance with section 38(3) or (5) is to be arrived at assuming the rate of tax is the lower rate of tax (see paragraph 2(6)).

• (2) For the purpose of calculating the donated amount, section 39A does not apply to a specific gift of property in relation to which section 23(1) applies (but that section does apply to such a gift for the purpose of calculating the baseline amount).

• (3) Subject to sub-paragraphs (1) and (2), the provisions of this Act apply for the purpose of calculating the donated amount and the baseline amount as for the purpose of calculating the tax to be charged on the value transferred by the chargeable transfer.

Election to merge parts of the estate

7

• (1) An election may be made under this paragraph if, for a component of the estate, the donated amount is at least 10% of the baseline amount.

• (2) That component is referred to as “the qualifying component”.

• (3) The effect of the election is that the qualifying component and one or more eligible parts of the estate (as specified in the election) are to be treated for the purposes of this Schedule as if they were a single component.

• (4) Accordingly, if the donated amount for that deemed single component is at least 10% of the baseline amount for it, the property in that component is to be included in the part of TP that qualifies for the lower rate of tax.

• (5) In relation to the qualifying component—

• (a) each one of the other two components of the estate is an “eligible part” of the estate, and

• (b) all the property that forms part of the estate by virtue of section 102(3) of the Finance Act 1986 (gifts with reservation) is also an “eligible part” of the estate.

• (6) The election must be made by all those who are appropriate persons with respect to the qualifying component and each of the eligible parts to be treated as a single component.

• (7) “Appropriate persons” means—

• (a) with respect to the survivorship component, all those to whom the property in that component passes on D's death (or, if they have subsequently died, their personal representatives),

• (b) with respect to the settled property component, the trustees of all the settled property in that component,

• (c) with respect to the general component, all the personal representatives of D or, if there are none, all those who are liable for the tax attributable to the property in that component, and

• (d) with respect to property within paragraph (b) of sub-paragraph (5), all those in whom the property within that paragraph is vested when the election is to be made.

Opting out

8

• (1) If an election is made under this paragraph in relation to a component of the estate, this Schedule is to apply as if the donated amount for that component were less than 10% of the baseline amount for it (whether or not it actually is).

• (2) The election must be made by all those who are appropriate persons (as defined in paragraph 7(7)) with respect to the component.

Elections: procedure

9

• (1) An election under this Schedule must be made by notice in writing to HMRC within two years after D's death.

• (2) An election under this Schedule may be withdrawn by notice in writing to HMRC given—

• (a) by all those who would be entitled to make such an election, and

• (b) no later than the end of the period of two years and one month after D's death.

• (3) An officer of Revenue and Customs may agree in a particular case to extend the time limit in sub-paragraph (1) or (2)(b) by such period as the officer may allow.

General interpretation

10

In this Schedule, in relation to D—

• “the chargeable transfer” means the chargeable transfer mentioned in paragraph 1(1);

• “the estate” means D's estate immediately before death;

• “the relevant transfer” means the transfer of value that D is treated (under section 4) as having made immediately before death.

The British Museum.

89C

• (1) The trusts on which settled property is held are not to be treated for the purposes of section 89B(1)(c) or (d) (meaning of “disabled person's interest”: cases involving an interest in possession) as failing to secure that the settled property is applied for the benefit of a beneficiary by reason only of—

• (a) the trustees' having powers that enable them to apply otherwise than for the benefit of the beneficiary amounts (whether consisting of income or capital, or both) not exceeding the annual limit,

• (b) the trustees' having the powers conferred by section 32 of the Trustee Act 1925 (powers of advancement),

• (c) the trustees' having those powers but free from, or subject to a less restrictive limitation than, the limitation imposed by proviso (a) of subsection (1) of that section,

• (d) the trustees' having the powers conferred by section 33 of the Trustee Act (Northern Ireland) 1958 (corresponding provision for Northern Ireland),

• (e) the trustees' having those powers but free from, or subject to a less restrictive limitation than, the limitation imposed by subsection (1)(a) of that section, or

• (f) the trustees' having powers to the like effect as the powers mentioned in any of paragraphs (b) to (e).

• (2) For the purposes of this section, the “annual limit” is whichever is the lower of the following amounts—

• (a) £3,000, and

• (b) 3% of the amount that is the maximum value of the settled property during the period in question.

• (3) For those purposes the annual limit applies in relation to each period of 12 months that begins on 6 April.

• (4) The Treasury may by order made by statutory instrument—

• (a) specify circumstances in which subsection (1)(a) is, or is not, to apply in relation to a trust, and

• (b) amend the definition of “the annual limit” in subsection (2).

• (5) An order under subsection (4) may—

• (a) make different provision for different cases, and

• (b) contain transitional and saving provision.

• (6) A statutory instrument containing an order under subsection (4) may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, the House of Commons.

162A

• (1) To the extent that a liability is attributable to financing (directly or indirectly)—

• (a) the acquisition of any excluded property, or

• (b) the maintenance, or an enhancement, of the value of any such property,

it may only be taken into account so far as permitted by subsections (2) to (4).

• (2) Where the property mentioned in subsection (1) has been disposed of, in whole or in part, for full consideration in money or money's worth, the liability may be taken into account up to an amount equal to so much of that consideration as—

• (a) is not excluded property, and

• (b) has not been used—

• (i) to finance (directly or indirectly) the acquisition of excluded property or the maintenance, or an enhancement, of the value of such property, or

• (ii) to discharge (directly or indirectly) any other liability that, by virtue of this section, would not be taken into account.

• (3) The liability may be taken into account up to an amount equal to the value of such of the property mentioned in subsection (1) as—

• (a) has not been disposed of, and

• (b) is no longer excluded property.

• (4) To the extent that any remaining liability is greater than the value of such of the property mentioned in subsection (1) as—

• (a) has not been disposed of, and

• (b) is still excluded property,

it may be taken into account, but only so far as the remaining liability is not greater than that value for any of the reasons mentioned in subsection (7).

• (5) Subsection (6) applies where—

• (a) a liability or any part of a liability is attributable to financing (directly or indirectly)—

• (i) the acquisition of property that was not excluded property, or

• (ii) the maintenance, or an enhancement, of the value of such property, and

• (b) the property or part of the property—

• (i) has not been disposed of, and

• (ii) has become excluded property.

• (6) The liability or (as the case may be) the part may only be taken into account to the extent that it exceeds the value of the property, or the part of the property, that has become excluded property, but only so far as it does not exceed that value for any of the reasons mentioned in subsection (7).

• (7) The reasons are—

• (a) arrangements the main purpose, or one of the main purposes, of which is to secure a tax advantage,

• (b) an increase in the amount of the liability (whether due to the accrual of interest or otherwise), or

• (c) a disposal, in whole or in part, of the property.

• (8) In this section—

• “arrangements” includes any scheme, transaction or series of transactions, agreement or understanding, whether or not legally enforceable, and any associated operations;

• “remaining liability” means the liability mentioned in subsection (1) so far as subsections (2) and (3) do not permit it to be taken into account;

• “tax advantage” means—the avoidance or reduction of a charge to tax, orthe avoidance of a possible determination in respect of tax.

162B

• (1) Subsection (2) applies if—

• (a) the whole or part of any value transferred by a transfer of value is to be treated as reduced, under section 104, by virtue of it being attributable to the value of relevant business property, and

• (b) the transferor has a liability which is attributable, in whole or in part, to financing (directly or indirectly)—

• (i) the acquisition of that property, or

• (ii) the maintenance, or an enhancement, of its value.

• (2) The liability is, so far as possible, to be taken to reduce the value attributable to the value of the relevant business property, before it is treated as reduced under section 104, but only to the extent that the liability—

• (a) is attributable as mentioned in subsection (1)(b), and

• (b) does not reduce the value of the relevant business property by virtue of section 110(b).

• (3) Subsection (4) applies if—

• (a) the whole or part of any value transferred by a transfer of value is to be treated as reduced, under section 116, by virtue of it being attributable to the agricultural value of agricultural property, and

• (b) the transferor has a liability which is attributable, in whole or in part, to financing (directly or indirectly)—

• (i) the acquisition of that property, or

• (ii) the maintenance, or an enhancement, of its agricultural value.

• (4) To the extent that the liability is attributable as mentioned in subsection (3)(b), it is, so far as possible, to be taken to reduce the value attributable to the agricultural value of the agricultural property, before it is treated as reduced under section 116.

• (5) Subsection (6) applies if—

• (a) part of the value of a person's estate immediately before death is attributable to the value of land on which trees or underwood are growing,

• (b) the value of the trees or underwood is to be left out of account, under section 125(2)(a), in determining the value transferred by the chargeable transfer made on the person's death, and

• (c) the person has a liability which is attributable, in whole or in part, to financing (directly or indirectly)—

• (i) the acquisition of the land or trees or underwood,

• (ii) planting the trees or underwood, or

• (iii) the maintenance, or an enhancement, of the value of the trees or underwood.

• (6) To the extent that the liability is attributable as mentioned in subsection (5)(c), it is, so far as possible, to be taken to reduce the value of the trees or underwood, before their value is left out of account.

• (7) Subject to subsection (8), to the extent that a liability is, in accordance with this section, taken to reduce value in determining the value transferred by a chargeable transfer, that liability is not then to be taken into account in determining the value transferred by any subsequent transfer of value by the same transferor.

• (8) Subsection (7) does not prevent a liability from being taken into account by reason only that the liability has previously been taken into account in determining the amount on which tax is chargeable under section 64.

• (9) For the purposes of subsections (1) to (4) and (7), references to a transfer of value or chargeable transfer include references to an occasion on which tax is chargeable under Chapter 3 of Part 3 (apart from section 79) and—

• (a) references to the value transferred by a transfer of value or chargeable transfer include references to the amount on which tax is then chargeable, and

• (b) references to the transferor include references to the trustees of the settlement concerned.

• (10) In this section—

• “agricultural property” and “agricultural value” have the same meaning as in Chapter 2 of Part 5;

• “relevant business property” has the same meaning as in Chapter 1 of Part 5.

162C

• (1) This section applies for the purposes of determining the extent to which a liability is attributable as mentioned in section 162A(1) or (5) , 162AA(1) or 162B(1)(b), (3)(b) or (5)(c).

• (1A) In a case in which the value of a person's estate immediately before death is to be determined, where a liability was discharged in part before that time—

• (a) any part of the liability that, at the time of discharge, was not attributable as mentioned in subsection (1) is, so far as possible, to be taken to have been discharged first,

• (b) any part of the liability that, at the time of discharge, was attributable as mentioned in section 162B(1)(b), (3)(b) or (5)(c) is, so far as possible, only to be taken to have been discharged after any part of the liability within paragraph (a) was discharged,

• (c) any part of the liability that, at the time of discharge, was attributable as mentioned in section 162AA(1) is, so far as possible, only to be taken to have been discharged after any parts of the liability within paragraph (a) or (b) were discharged, and

• (d) any part of the liability that, at the time of discharge, was attributable as mentioned in section 162A(1) or (5) is, so far as possible, only to be taken to have been discharged after any parts of the liability within paragraphs (a) to (c) were discharged.

• (2) In any other case, where a liability was discharged in part before the time in relation to which the question as to whether or how to take it into account arises—

• (a) any part of the liability that, at the time of discharge, was not attributable as mentioned in section 162A(1) or (5) or 162B(1)(b), (3)(b) or (5)(c) is, so far as possible, to be taken to have been discharged first,

• (b) any part of the liability that, at the time of discharge, was attributable as mentioned in section 162B(1)(b), (3)(b) or (5)(c) is, so far as possible, only to be taken to have been discharged after any part of the liability within paragraph (a) was discharged, and

• (c) any part of the liability that, at the time of discharge, was attributable as mentioned in section 162A(1) or (5) is, so far as possible, only to be taken to have been discharged after any parts of the liability within paragraph (a) or (b) were discharged.

175A

• (1) In determining the value of a person's estate immediately before death, a liability may be taken into account to the extent that—

• (a) it is discharged on or after death, out of the estate or from excluded property owned by the person immediately before death, in money or money's worth, and

• (b) it is not otherwise prevented, under any provision of this Act, from being taken into account.

• (2) Where the whole or any part of a liability is not discharged in accordance with paragraph (a) of subsection (1), the liability or (as the case may be) the part may only be taken into account for the purpose mentioned in that subsection to the extent that—

• (a) there is a real commercial reason for the liability or the part not being discharged,

• (b) securing a tax advantage is not the main purpose, or one of the main purposes, of leaving the liability or part undischarged, and

• (c) the liability or the part is not otherwise prevented, under any provision of this Act, from being taken into account.

• (3) For the purposes of subsection (2)(a) there is a real commercial reason for a liability, or part of a liability, not being discharged where it is shown that—

• (a) the liability is to a person dealing at arm's length, or

• (b) if the liability were to a person dealing at arm's length, that person would not require the liability to be discharged.

• (4) Where, by virtue of this section, a liability is not taken into account in determining the value of a person's estate immediately before death, the liability is also not to be taken into account in determining the extent to which the estate of any spouse or civil partner of the person is increased for the purposes of section 18.

• (5) In subsection (2)(b) “tax advantage” means—

• (a) a relief from tax or increased relief from tax,

• (b) a repayment of tax or increased repayment of tax,

• (c) the avoidance, reduction or delay of a charge to tax or an assessment to tax, or

• (d) the avoidance of a possible assessment to tax or determination in respect of tax.

• (6) In subsection (5) “tax” includes income tax and capital gains tax.

• (7) Where the liability is discharged as mentioned in subsection (1)(a) only in part—

• (a) any part of the liability that is attributable as mentioned in section 162A(1) or (5) is, so far possible, taken to be discharged first,

• (aa) any part of the liability that is attributable as mentioned in section 162AA(1) is, so far as possible, taken to be discharged only after any part of the liability within paragraph (a) is discharged,

• (b) any part of the liability that is attributable as mentioned in section 162B(1)(b), (3)(b) or (5)(c) is, so far as possible, taken to be discharged only after any parts of the liability within paragraph (a) or (aa) are is discharged, and

• (c) the liability so far as it is not attributable as mentioned in any of paragraphs (a) to (b) is, so far as possible, taken to be discharged only after any parts of the liability within any of those paragraphs are discharged.

267ZA

• (1) A person may, if condition A or B is met, elect to be treated for the purposes of this Act as domiciled in the United Kingdom (and not elsewhere).

• (2) A person's personal representatives may, if condition B is met, elect for the person to be treated for the purposes of this Act as domiciled in the United Kingdom (and not elsewhere).

• (3) Condition A is that, at any time before 6 April 2025 but during the period of 7 years ending with the date on which the election is made, the person had a spouse or civil partner who was domiciled in the United Kingdom.

• (4) Condition B is that a person (“the deceased”) dies and, at any time before 6 April 2025 but within the period of 7 years ending with the date of death, the deceased was—

• (a) domiciled in the United Kingdom, and

• (b) the spouse or civil partner of the person who would, by virtue of the election, be treated as domiciled in the United Kingdom.

• (5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (6) An election under this section is to be ignored—

• (a) in interpreting any such provision as is mentioned in section 158(6), and

• (b) in determining the effect of any qualifying double taxation relief arrangements in relation to a transfer of value by the person making the election.

• (7) For the purposes of subsection (6)(b) a qualifying double taxation relief arrangement is an arrangement which is specified in an Order in Council made under section 158 before the coming into force of this section (other than by way of amendment by an Order made on or after the coming into force of this section).

• (8) In determining for the purposes of this section whether a person making an election under this section was domiciled in the United Kingdom, section 267 (deemed domicile) is to be ignored.

267ZB

• (1) For the purposes of this section—

• (a) references to a lifetime election are to an election made by virtue of section 267ZA(3), and

• (b) references to a death election are to an election made by virtue of section 267ZA(4).

• (2) A lifetime or death election is to be made by notice in writing to HMRC.

• (3) A lifetime or death election is treated as having taken effect on a date specified, in accordance with subsection (4), in the notice.

• (4) The date specified in a notice under subsection (3) must—

• (a) be 5 April 2025 or an earlier date,

• (b) be within the period of 7 years ending with—

• (i) in the case of a lifetime election, the date on which the election is made, or

• (ii) in the case of a death election, the date of the deceased's death, and

• (c) meet the condition in subsection (5).

• (5) The condition in this subsection is met by a date if, on the date—

• (a) in the case of a lifetime election—

• (i) the person making the election was married to, or in a civil partnership with, the spouse or civil partner, and

• (ii) the spouse or civil partner was domiciled in the United Kingdom, or

• (b) in the case of a death election—

• (i) the person who is, by virtue of the election, to be treated as domiciled in the United Kingdom was married to, or in a civil partnership with, the deceased, and

• (ii) the deceased was domiciled in the United Kingdom.

• (6) A death election may only be made within 2 years of the death of the deceased or such longer period as an officer of Revenue and Customs may in the particular case allow.

• (7) Subsection (8) applies if—

• (a) a lifetime or death election is made,