Capital Transfer Tax Act 1984

174 Income tax and unpaid capital transfer tax

(1) In determining the value of a person's estate immediately before his death, allowance shall be made for—

(a) any liability for income tax in respect of an offshore income gain, within the meaning of Chapter VII of Part II of the [1984 c. 43.] Finance Act 1984, arising on a disposal which is deemed to occur on the death by virtue of section 92(3) of that Act; and

(b) any liability to income tax arising under paragraph 1 of Schedule 9 to the Finance Act 1984 (deep discount securities) on a disposal which is deemed to occur by virtue of paragraph 2(2) of that Schedule.

(2) Where in determining the value of a person's estate immediately before his death a liability for capital transfer tax is taken into account, then, if that tax or any part of it is not in the event paid out of the estate, the value of the estate immediately before his death shall be treated as increased by an amount equal to that tax or so much of it as is not so paid.