Section 29 Loans—modifications of exemptions.

United Kingdom

(1)

If or to the extent that a transfer of value is a disposition whereby the use of money or other property is allowed by one person to another (“the borrower”), the preceding provisions of this Chapter shall apply to it with the following modification.

(2)

For the purposes of section 18 the borrower’s estate shall be treated as increased by an amount equal to the value transferred; and section 18(3) shall not apply.

(3)

For the purposes of sections 20 and 22 the transfer of value shall be treated as made by outright gift.

(4)

Section 21(1) shall apply as if for the conditions stated in paragraphs (a) and (b) there were substituted the condition that the transfer was a normal one on the part of the transferor.

(5)

For the purposes of sections 23 F1to 25—

(a)

the value transferred shall be treated as attributable to the property of which the borrower is allowed the use, and

(b)

that property shall be treated as given to, or as becoming the property of, the borrower unless the use allowed includes use for purposes other than charitable purposes or those of a body mentioned in section 24, or 25F2or where it is land, of a body mentioned in section 24A

and sections 23(2) to (6), 24 . . . F3, (3) and (4), 24A(3)and 25(2) shall not apply.

Annotations

Textual amendments

F1

Words in s. 29(5) substituted (31.7.1998 with effect in relation to any transfer of value made on or after 17.3.1998) by 1998 c. 36, s. 143(2)(b)

F2

Finance Act 1989 s. 171(3),in relation to transfers of value made on or after 14March 1989.

F3

“(1)(b)”

repealed by Finance Act 1988 s. 148and Sch. 14, Part X,with effect from 15March 1988.

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.