Investment land

In 1983 a widow inherited some farmland on the death of her husband. She let the land under conacre and agistment agreements to local farmers. She died in 1999 although due to ill health she had left the farm in 1992 when her son-in-law took over.

The deceased's personal representatives claimed that the farmland was 'relevant business property' within the meaning of IHTA 1984 s 105(1). HMRC disallowed the claim. The representatives appealed.

The Special Commissioner found that the activity of tending the land undertaken by the brother-in-law was a business under s 105(1). The fact that he had to spend some 100 hours a year seriously tending the land tipped the balance in the appellants' favour. However when determining whether the business was one of holding investments for the purposes of s 105(3) the Commissioner said that the income from it arose...