Explanatory note

These Regulations amend the Inheritance Tax Act 1984 (“the Act”) to apply Business Property Relief to any property if the business concerned is a market maker anywhere within the European Economic Area.

Regulation 4 amends section 105 of the Act to insert subsection (4A). The new subsection provides that subsection (3) also does not apply to businesses which are of a description set out in regulations made under section 106(5) of the Finance Act 1986 (“the 1986 Act”).

Regulation 6 describes, for the purposes of sections 105(4A) of the Act, those businesses.

Regulation 5 amends section 234 of the Act to substitute subsection (3)(c) to include a provision that companies which are of a description set out in regulations made under section 107(5) of the 1986 Act fall within section 234(3)(c). This is in order to mirror the changes made by regulation 4 to ensure the treatment of companies in relation to the interest payable on instalments is the same as the relief.

Regulation 7 describes, for the purposes of section 234(3)(c)(ii) of the Act, those companies.

A Tax Information and Impact Note covering this instrument was published on 4th October 2012 alongside the draft legislation and is available on the HMRC website at http://www.hmrc.gov.uk/thelibrary/tiins.htm. It remains an accurate summary of the impacts that apply to this instrument.