CG14310 | Computation: interaction with other taxes: inheritance tax

Death is not a chargeable occasion for Capital Gains Tax (“CGT”) purposes. However, there may be occasions where a lifetime gift does give rise to a CGT charge. The existence of a possible charge to Inheritance Tax (“IHT”) does not usually affect the computation of any chargeable gain or allowable loss for CGT purposes. Sometimes, though, a decision taken in connection with one tax can have an impact on the other, for example

• Valuations, see section 274 and CG32210P.

• IHT heritage asset exemption, see section 258 and CG73300P.

• Gift hold-over relief, see section 260 and CG67030P.

Also, some common terms have different meanings for each of the two taxes. Where the definition is satisfied for one tax, you need to be aware that this does not necessarily mean that it will be satisfied for the other.

If HMRC staff need advice in relation to IHT, they should seek support from IHT Technical.