In Mr Bruce Firth & Mrs Rita Firth as Trustees of the L Bately 1984 Settlement v HMRC [2022] TC8542, the First Tier Tribunal (FTT) dismissed a claim for IHT Business Property Relief. The services provided by the 'apart-hotels' in question were not sufficient to prevent it from being an investment business.

The L Bately 1984 Settlement (the trust) held 31% of the shares in a company, The Lawrance (Hotel) Living Ltd (The Lawrance). It had originally been a shareholder in the group holding company but, in 2012, as part of a demerger exchanged its holding for shares in The Lawrance, which became a separate company.

The FTT found:

The appeal was dismissed.

Useful guides on this topic

IHT Business Property Relief
A guide to what Business Property Relief is, when it can apply and pitfalls and planning points.

Trusts & Estates: Ten-year charge reporting requirements
What is the ten-year charge (or principal or periodic charge) and when does it apply?

How to appeal an HMRC decision
Disagree with an HMRC decision? How to appeal, what type of decision can you appeal and what are your different options when you disagree with HMRC? What are the key steps in making an appeal?

External link

Mr Bruce Firth & Mrs Rita Firth as Trustees of the L Bately 1984 Settlement v HMRC [2022] TC8542


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