Finance Act, 1941

Gifts by way of creation of burdens or release of right.

32.—(1) The creation (whether before or after the passing of this Act) by a person or with his consent of a debt or other right enforceable against him personally or against property which he is or may become competent to dispose of, charge, or burden for his own benefit shall be deemed for the purposes of the enactments relating to estate duty (including this Part of this Act) to be a disposition made by that person, and in every such enactment the word “property” shall, in relation to any such disposition, be construed as including the debt or right so created.

(2) The extinguishment (whether before or after the passing of this Act) at the expense of a person of a debt or other right shall be deemed for the purposes of the enactments relating to estate duty (including this Part of this Act) to be a disposition made by that person in favour of the person for whose benefit the said debt or right is so extinguished, and in every such enactment the word “property” shall be construed as including the benefit conferred by the extinguishment of the said debt or right.

(3) The proviso to section 4 of the Finance Act, 1894 (which excepts from aggregation property in which the deceased never had an interest) shall not have effect in relation to property passing on the death of the deceased which consists of a debt, right, or benefit which is, by virtue of this section, to be included in the connotation of the word “property” in the enactments (including as hereinbefore mentioned) relating to estate duty.

(4) This section shall have effect only in relation to persons dying after the 7th day of May, 1941.