Section 64 Charge at ten-year anniversary.
United Kingdom
Where immediately before a ten-year anniversary all or any part of the property comprised in a settlement is relevant property, tax shall be charged at the rate applicable under sections 66 and 67 below on the value of the property or part at that time.
For the purposes of subsection (1) above, property held by the trustees of a settlement immediately before a ten-year anniversary is to be regarded as relevant property comprised in the settlement at that time if—
it is income of the settlement,
the income arose before the start of the five years ending immediately before the ten-year anniversary,
the income arose (directly or indirectly) from property comprised in the settlement that, when the income arose, was relevant property, and
when the income arose, no person was beneficially entitled to an interest in possession in the property from which the income arose.
F3Where the settlor of property comprised in a settlement meets the condition in subsection (1BZA), income of the settlement F4that arose (directly or indirectly) from the property is not to be regarded as relevant property comprised in the settlement as a result of subsection (1A) above so far as the income—
is situated outside the United Kingdom, or
is represented by a holding in an authorised unit trust or a share in an open-ended investment company.
The condition is that the settlor—
is alive and is not a long-term UK resident immediately before the ten-year anniversary,
died on or after 6 April 2025 and was not a long-term UK resident immediately before their death, or
died before 6 April 2025 and was not domiciled in the United Kingdom when the property became comprised in the settlement.
If—
an amount is payable in respect of property (“the existing property”) comprised in a settlement, and
the amount represents an accumulation of income which (once accumulated) becomes comprised in the settlement,
F7subsection (1BZA)(c) has effect, in the case of the amount, as if any reference to the time it became comprised in the settlement were to the time the existing property became comprised in the settlement.
Income of the settlement is not to be regarded as relevant property comprised in the settlement as a result of subsection (1A) above so far as the income—
is represented by securities issued by the Treasury subject to a condition of the kind mentioned in subsection (2) of section 6 above, and
it is shown that all known persons for whose benefit the settled property or income from it has been or might be applied, or who are or might become beneficially entitled to an interest in possession in it, are persons of a description specified in the condition in question.
For the purposes of subsection (1) above, a foreign-owned work of art which is situated in the United Kingdom for one or more of the purposes of public display, cleaning and restoration (and for no other purpose) is not to be regarded as relevant property.
Annotations
Textual amendments
- F1
S. 64 renumbered (6.4.2009 with effect as mentioned in art. 13(5) of the amending S.I.) as s. 64(1) by The Enactment of Extra-Statutory Concessions Order 2009 (S.I. 2009/730), art. 13(3)
- F2
S. 64(1A)-(1C) inserted (with effect in accordance with Sch. 25 para. 4(3) of the amending Act) by Finance Act 2014 (c. 26), Sch. 25 para. 4(1)
- F3
Words in s. 64(1B) substituted (6.4.2025) by Finance Act 2025 (c. 8), Sch. 13 paras. 10(2), 45(1)
- F4
Words in s. 64(1B) inserted (with effect in accordance with s. 73(11) of the amending Act) by Finance Act 2020 (c. 14), s. 73(5)(a)(iii)
- F5
S. 64(1BZA) inserted (6.4.2025) by Finance Act 2025 (c. 8), Sch. 13 paras. 10(3), 45(1)
- F6
S. 64(1BA) inserted (with effect in accordance with s. 73(11) of the amending Act) by Finance Act 2020 (c. 14), s. 73(5)(b)
- F7
Words in s. 64(1BA) substituted (6.4.2025) by Finance Act 2025 (c. 8), Sch. 13 paras. 10(4), 45(1)
- F8
S. 64(2) inserted (6.4.2009 with effect as mentioned in art. 13(5) of the amending S.I.) by The Enactment of Extra-Statutory Concessions Order 2009 (S.I. 2009/730), art. 13(3)
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 III
Textual amendments
- F1
Words in Pt. 3 Ch. 3 heading added (22.3.2006) by Finance Act 2006 (c. 25), s. 156, Sch. 20 para. 20(5)
Modifications
- C1
See Finance Act 1990 s. 126—exemption for pools payments to trustees for football ground improvements in respect of events on or after 6April 1990.
- C2
Pt. 3 Ch. 3 modified (22.7.2004) by Finance Act 2004 (c. 12), s. 283, Sch. 36 para. 57(1) (with s. 283(5))
- C3
Pt. 3 Ch. 3 modified (22.7.2004) by Finance Act 2004 (c. 12), s. 283, Sch. 36 para. 56(2)(b) (with s. 283(5))
- C4
Part III Chapter III (ss.58-85) excluded by Finance Act 1991 (c.31, SIF 63:1), s. 121(4).
Pt. III Ch. III (ss. 58-85) restricted (3.5.1994) by 1994 c. 9, s. 248