National heritage assets - tax relief

Certain buildings, land, works of art and other objects can be exempted from inheritance tax and capital gains tax when they are passed to a new owner. This is a special relief for national heritage assets that are gifted or bequeathed.

The assets must be one of the following:

• buildings, estates or parklands of outstanding historical or architectural interest;
• land of outstanding natural beauty and spectacular views;
• land of outstanding scientific interest including special areas for the conservation of wildlife, plants and trees; or
• objects with national scientific, historic or artistic interest, either in their own right or due to a connection with historical buildings.

In addition, the new owner must make an agreement, known as ‘the undertakings’ to look after the item, make it available for the general public to view and keep it in the UK.

If the owner does not meet these conditions or sells the asset in question, then the exemption (known as the Conditional Exemption Tax Incentive scheme) is withdrawn, and tax would be due subject to the usual rules. HMRC is guided by the government’s heritage advisory agencies in deciding which assets qualify for an exemption.

If you need some expert advice on inheritance tax and capital gains tax, please give our team a call on 01380 723692 or drop us an email.