IHTM18131 | Stocks and shares: unlisted shares: what are unlisted shares?
From HM Revenue & Customs · Inheritance Tax Manual
Where a company is listed on a market that does not meet the HMRC definition of ‘listed’, or is not listed on any market (for example, a family owned company), its shares and securities are classified as unlisted (or ‘unquoted’). You may see unlisted shares referred to as ‘NQs’. You will normally be alerted to the presence of unlisted shares and securities because an IHT412 has been completed.
“Quoted” is defined in as listed on a recognised stock exchange and unquoted means not so listed. From 6 April 2026, the meaning of “recognised stock exchange” and “listed on a recognised stock exchange” for income tax purposes has been incorporated into the .
A list of the recognised stock exchanges and the markets that do, or do not, meet the HMRC definition of ‘listed’ can be found here.
Shares which do have a listing can be regarded as unquoted or unlisted for IHT purposes either because they are listed on a sub- market of a recognised stock exchange rather than the official list e.g. Alternative Investment Market (“AIM”) shares or because they are listed on an exchange which is not a recognised stock exchange e.g. a foreign stock exchange.
The company will usually be a limited company (Ltd) but may occasionally be an unlimited company, and in some circumstances a Public Limited Company (PLC). The type of activity may range from and individual operating on a local level to a large national operation, but the company’s shares will often be held by a small number of investors and relatively few (if any) share transactions occur. Consequently, without comparable sales information, it is difficult to judge what value the shares have.
Although the shares do not have a readily definable value, they must be valued for tax purposes on the open market basis of and . The valuation must take into account a number of factors such as the size of the company and shareholding, and the company profits or assets. Taxpayers may need to contact the company in question to obtain information on the value of their shares. Generally, the valuation in HMRC of unlisted shares and securities is dealt with by Shares and Assets Valuation.
On or after 6 April 2026
If unquoted shares are traded on a recognised stock exchange or a stock exchange outside the United Kingdom which is not a recognised stock exchange, Business Relief () at a rate of 50% is available (see ).
Other unlisted shares qualify for Business Relief at 100%, but this is subject to the £2.5m allowance introduced by Schedule 12 of Finance (No.2) Act 2025-26 – see . For any part of the value of these shares that exceeds the allowance, relief is at 50%.
In both cases, the qualifying conditions must be met () for Business Relief to be available. If Business Relief is available, the instalment option ( is available.
If Business Relief is not available, the instalment option is available:
for controlling shareholdings under ); and
for smaller holdings if at least one of the provisions of /Ss228(1)(b), (c) or (d) is met.
Before 6 April 2026
Business Relief () was generally available on unlisted shares at a rate of 100% provided all the qualifying conditions are met.
The Instalment option () was available for controlling shareholdings under ).
Instalments for smaller holdings was available if at least one of the provisions of /Ss228(1)(b), (c) or (d) was met.