Using alternative assets to pay your inheritance tax

Using alternative assets to pay your inheritance tax

Using alternative assets to pay your inheritance tax

by | Inheritance

Should you be a passionate art collector or a generous artist’s relative, you may well have the alternative to an Inheritance tax bill hanging on your wall.

The Acceptance in Lieu of Tax (AIL) scheme enables taxpayers to transfer works of art into public ownership.  This was recently exercised to the benefit of the Scottish National Gallery of Modern Art (SNGMA).  AIL is a reserved matter but “executive devolution” arrangements are in place to enable Scottish Ministers to deal with cases in which there is a Scottish Interest.

Now on display, SNGMA acquired 1932 (profile: Venetian red).  It was painted by Ben Nicholson (1894-1982) in the first year of his relationship with the sculptor Barbara Hepworth.  The painting, worth £250,000, contains a semi-veiled likeness of his lover.

Simon Groom, director of the Scottish National Gallery of Modern Art, said: “We are delighted that this beautiful and important painting now joins the national collection.”

The amount of tax that settled in the allocation of Nicholson’s 1932 (profile: Venetian red) is £241,297.  So if you have a passion for art, that investment may be even more than just a beautiful thing.  It can be a tax relief that will be enjoyed forever by all in a museum of your choosing.

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