I am hoping the forum members will be able to advise me on the following:
My client wishes to gift shares in a family trading company to her children using a Deed of Variation. Her Husband died recently leaving everything to her including 100% of the shares in the family business. I believe that in order to claim BPR I will need to submit a corrective account to HMRC as the shares were passed to my client under the spouse exemption and no BPR was applied for (although, at the moment, I am assuming this as I did not deal with probate for the client). At a meeting with the clients accountant I was confidently told that BPR would apply but then they went on to confirm that it owned and let a residential property.
My query is whether BPR would apply to the investment property owned by the company. If the investment property cannot qualify for BPR then there is a potential IHT liability (the client is also looking to gift another asset which uses husbands entire NRB) I cannot gift the shares without the property being included. If my client simply gifted the shares and survived 7 years would this get around the problem?
Phoenix Legal Group