(1)Where the value of any property comprised in a person’s estate would be less than the appropriate portion of the value of the aggregate of that and any related property, it shall be the appropriate portion of the value of that aggregate.
(2)For the purposes of this section, property is related to the property comprised in a person’s estate if—
(a)it is comprised in the estate of his spouse [F1or civil partner] ; or
(b)it is or has within the preceding five years been—
(i)the property of a charity, or held on trust for charitable purposes only, or
(ii)the property of a body mentioned in section 24, [F224A,][F3or 25] above,
and became so on a transfer of value which was made by him or his spouse [F1or civil partner] after 15th April 1976 and was exempt to the extent that the value transferred was attributable to the property.
(3)The appropriate portion of the value of the aggregate mentioned in subsection (1) above is such portion thereof as would be attributable to the value of the first-mentioned property if the value of that aggregate were equal to the sums of the values of that and any related property, the value of each property being determined as if it did not form part of that aggregate.
(4)For the purposes of subsection (3) above the proportion which the value of a smaller number of shares of any class bears to the value of a greater number shall be taken to be that which the smaller number bears to the greater; and similarly with stock, debentures and units of any other description of property.
(5)Shares shall not be treated for the purposes of subsection (4) above as being of the same class unless they are so treated by the practice of a recognised stock exchange or would be so treated if dealt with on such a stock exchange.
Textual Amendments
F1Words in s. 161(2) inserted (5.12.2005) by The Tax and Civil Partnership Regulations 2005 (S.I. 2005/3229), regs. 1(1), 34
F2Finance Act 1989 s. 171(4),with effect from 14March 1989.
F3Words in s. 161(2)(b) substituted (31.7.1998 with effect in relation to any property becoming property of a body on a transfer of value made on or after 17.3.1998) by 1998 c. 36, s. 143(6)