Finance Act, 1997

Second Schedule (computation of tax) to Principal Act, declaratory provision.

136.—(1) For the avoidance of doubt it is hereby declared that paragraph 3 (inserted by the Finance Act, 1984 ) of the Second Schedule to the Principal Act shall have effect and be deemed always to have had effect as if the following paragraph were substituted therefor:

“3. Subject to the provisions of paragraph 6, the tax chargeable on the taxable value of a taxable gift or a taxable inheritance taken by a donee or successor shall be of an amount equal to the amount by which the tax computed on aggregate A exceeds the tax computed on aggregate B, where—

(a) aggregate A is the aggregate of the following:

(i) the said taxable value, and

(ii) the taxable value of each and every taxable gift and taxable inheritance taken previously by the said donee or successor on or after the 2nd day of June, 1982,

(b) aggregate B is the aggregate of the taxable values of all taxable gifts and taxable inheritances so previously taken, and

(c) the tax on an aggregate is computed at the rate or rates of tax applicable under the Table to that aggregate:

Provided that—

(i) in a case where no taxable gift or taxable inheritance was so previously taken, the amount of the tax computed on aggregate B shall be deemed to be nil,

(ii) in every other case, the amount of the tax chargeable shall not exceed the amount which would be chargeable if the threshold amount which applies to aggregate A were deemed, irrespective of the definition of ‘threshold amount’, to be also the threshold amount which applies to aggregate B, and

(iii) the amount of an aggregate that comprises only a single taxable value shall be equal to that value.”.

(2) Subsection (1) shall not apply to a gift or inheritance in relation to which paragraph 3 of the Second Schedule to the Principal Act was the subject of a determination of the Appeal Commissioners, being a determination made before the 1st day of May, 1997, under section 52 of the Principal Act.