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03 December 2008
Issue: 4187 / Categories: Forum & Feedback
What are the implications of units in a unit trust that are acquired during an executry or period of administration? How are these treated under IHTA 1984, s 185 and declared on form IHT35? The workings of IHTA 1984, ss 178 and 179 and the claim by the 'appropriate person' are reviewed.

Given the recent turmoil in the markets we are likely to see more cases where it is necessary to submit forms IHT35 to claim loss relief on the sale of shares in an executry or period of administration.

Where a unit trust holding is increased after the date of death by reinvested dividends then on a subsequent sale of any of the holding IHTA 1984 s 185 applies to determine which of the sold units are treated as being from the death estate and which were acquired after date of death.

Is it also then necessary to include the acquisition of the new units from the dividend as a 'purchase of qualifying investments' in section 2 of the form?

Is there a similar adjustment if the reinvestment is effected by enhancing the unit price rather than buying more units and if not doesn't...

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