Gifting BPR-rich assets

The good news is that you can gift business assets that enjoy business property relief (BPR) without putting that relief at risk.

But you have to follow strict rules; ignore these and the valuable BPR can go up in smoke! The rules are:

Gifting BPR-rich assetsThe person being given the asset has to retain ownership of it until the person giving them the asset dies. However, the person receiving the business asset can replace it without losing valuable business property relief. So if machinery is gifted, it can be replaced without losing relief.

Gifting BPR-rich assetsAt the time of the transfer, the asset must already be in a position to enjoy business property relief. This means, for example, that a gift of business property must not be let out at the time of the transfer.

When making a gift of a business asset, specify what category the gift falls into. Is it an exempt gift or a potentially exempt transfer? Being specific about the gift makes the executor's job easier.

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