Section 109 Successive transfers.

United Kingdom

(1)

Where—

(a)

the whole or part of the value transferred by a transfer of value (in this section referred to as the earlier transfer) was eligible for relief under this Chapter (or would have been so eligible if such relief had been capable of being given in respect of transfers of value made at that time), and

(b)

the whole or part of the property which, in relation to the earlier transfer, was relevant business property became, through the earlier transfer, the property of the person or of the spouse F1or civil partner of the person who is the transferor in relation to a subsequent transfer of value, and

(c)

that property or part, or any property directly or indirectly replacing it, would (apart from section 106 above) have been relevant business property in relation to the subsequent transfer of value, and

(d)

either the earlier transfer was, or the subsequent transfer of value is, a transfer made on the death of the transferor,

the property which would have been relevant business property but for section 106 above shall be relevant business property notwithstanding that section.

(2)

Where the property which, by virtue of subsection (1) above, is relevant business property replaced the property or part referred to in paragraph (c) of that subsection, relief under this Chapter shall not exceed what it would have been had the replacement or any one or more of the replacements not been made, but section 107(3) above shall apply with the necessary modifications for the purposes of this subsection.

(3)

Where, under the earlier transfer, the amount of the value transferred which was attributable to the property or part referred to in subsection (1)(c) above was part only of its value, a like part only of the value which (apart from this subsection) would fall to be reduced under this Chapter by virtue of this section shall be so reduced.

Annotations

Textual amendments

F1: Words in s. 109(1)(b) inserted (5.12.2005) by The Tax and Civil Partnership Regulations 2005 (S.I. 2005/3229), regs. 1(1), 20

Notes on the whole Act

Textual amendments

F1: By Finance Act 1986 s. 100(1), on and after 25 July 1986 the Capital Transfer Tax Act 1984 may be cited as the Inheritance Tax Act 1984.

Notes on Chapter I

Modifications

C1: Pt. 5 Ch. 1 modified (16.7.1992) by Finance (No.2) Act 1992 (c. 48), s. 73, Sch. 14, para. 9(4).
C2: Pt. 5 Ch. 1 modified (temp.) (retrospective to 30.10.2024) by Finance Act 2026 (c. 11), Sch. 12 para. 15