Business Relief

How do you calculate the relief amount?

The taxable value of the relevant business property is reduced by 90%.

You calculate the taxable value by deducting from the market value of the relevant business property:

  • liabilities
  • costs
  • expenses
  • any consideration.

A consideration is the amount of money or money's worth paid by the person receiving the gift or inheritance, towards the business property.

Excepted assets

Certain assets, known as 'excepted assets', are not included in the 90% reduction when calculating the taxable value. These are:

  • assets not being used for the purposes of the business
  • assets purchased more than two years before the gift or inheritance, and not used wholly or mainly for the purpose of the business. 'Wholly or mainly' means more than 50%
  • any new business bought by a company within the minimum ownership period. This does not apply if the new business is fully or partially replacing the existing business.

Next: Minimum ownership period of business property