Inheritance Tax Act 1984 section 187

Attribution of values to specific investments

Section 187 sets out how to determine the revised value of each individual investment included in a loss on sale of shares relief claim, which is particularly important for capital gains tax purposes.

• The default revised value of a specific investment is its sale value, but this must be adjusted where the relief has been restricted due to purchases of qualifying investments.
• Where the relief is restricted, the revised value is adjusted upwards or downwards by a relevant proportion of the difference between the death value and the sale price, depending on which is greater.
• The sale value must be reduced by the amount of any call paid on the investment, and may also need to be reduced where there has been a change in company capitalisation and consideration was given for the new holding.
• The sale price means the actual price achieved or, if greater, the best consideration that could reasonably have been obtained at the time of sale, with capital receipts also taken into account.